CORPORATE INTERESTS & PROFITSIS DRIVEN BY THE MOTIVATION TO PROTECT THEIR OWN

FOR CRIMINAL JUSTICE REFORMKOCH ADVOCACY

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KOCH ADVOCACY FOR CRIMINAL JUSTICE REFORM IS DRIVEN BY THE MOTIVATION TO PROTECT THEIR OWN

CORPORATE INTERESTS & PROFITS SUMMARY At first glance, the Koch brothers push for criminal justice reform could seem purely altruistic – an issue that lands them positive headlines for working with strange bedfellows and masks the hundreds of billions they spend to profit from our political system. But for the Koch brothers, their business and political interests always come first, and their recent campaign to promote their advocacy for criminal justice reform directly benefits their companies. This Bridge Project report exposes the Koch brothers' shadowy history with criminal justice reform, the criminal history their business empire has accrued, their advocacy against corporate responsibility for criminal action, and the shocking disparity between the Kochs' massive political spending and the comparatively little they spend actually advocating for criminal justice reform. The story begins in the 1990s when four Koch employees at a refinery in Corpus Christi, Texas were indicted on criminal charges for violating the Clean Air Act and other laws. The Kochs’ top lawyer, Mark Holden who is now the face of their criminal justice reform campaign, argued that scrutiny of the criminal activity of Koch employees could have an “insidious” effect on company culture. Thus, after Koch employees were charged on 97 counts of environmental crimes, the Kochs interest in “championing” criminal justice reform began. The Kochs’ shadowy history with criminal justice reform is vast: Koch Industries has been convicted of multiple felonies, which they repeatedly have failed to disclose. Yes, Koch industries itself would benefit from a campaign to ‘ban the box,’ because they have been fined in the past for failing to do so. Furthermore, Koch Industries has built a laundry list of criminal and potentially criminal activities including environmental violations resulting in nearly $90 million in fines and settlements (and likely millions more in undisclosed settlements), deaths and serious injuries resulting from workplace accidents, and improper business practices. The Koch brothers’ motivation is driven by dollars, which is clearly revealed in where they have pushed for reform would lead to a direct benefit for their companies such as banning the box on permitting applications, making occupational licensing requirements less stringent, and corporate liability reform. Finally, for the Kochs money talks, and they haven’t put their money where their mouth is on criminal justice reform. While each election cycle they spend hundreds of millions buying candidates who back their agenda – save for their criminal justice reform platform – their spending on criminal justice reform remains “modest” by Koch standards. For the Kochs, their priority in reforming our justice system isn’t to defend right and wrong but to shield them from accountability and to protect their bottom line and future business interests.

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Contents Koch Advocacy For Criminal Justice Reform Is Driven By The Motivation To Protect Their Own Corporate Interests & Profits ........................................................................................... 1

Summary .................................................................................................................................................................................................... 1

Koch Industries Has A Criminal History ..................................................................................................... 2 Koch Industries Has Been Convicted Of Multiple Felonies ............................................................................................................ 2 Koch Repeatedly Failed To Disclose Its Felony Convictions On Federal Filings; Resulted In Fine And Admission Of Error ........................................................................................................................................................................................................... 3

Criminal And Potentially Criminal Activity Related To Koch Industries Including Environmental Violations, Workplace Accidents, And Improper Business Practices ........................................................ 11

Koch Industries Has A History Of Environmental Violations, Harming Our Air, Water, And Land, And Has Paid Almost $94 Million In Fines And Settlements .................................................................................................................................. 11 Multiple Deaths Have Been Reported Related To Koch Property And Facilities ...................................................................... 16 Many Severe Injuries Have Been Reported At Koch Facilities ...................................................................................................... 19 Koch Industries Has Received At Least 14 OSHA Violations Resulting In $38,184 In Fines................................................. 21 Koch Industries Accused Of Oil Theft From Indian Reservations And Others........................................................................ 25 Koch Industries Engaged In Other Potentially Illegal Activity Including Doing Business With IRan And Avoiding Taxes................................................................................................................................................................................................................... 26

Kochs Advocate Against Corporate Responsibility For Criminal Action .................................................. 33 For The Kochs, Corporate Criminal Activity Is About Economics And Protecting Their Own Future Interests, Not Right And Wrong................................................................................................................................................................................... 33 The Real Koch Priorities Are To Protect Their Corporate Culture And Business Operations ............................................... 33 Kochs Could Be Party To RICO Lawsuit Targeting Those Funding Climate Change Denial ................................................. 40 Overall, Koch Network Has Advocated For Decriminalization Across The Spectrum ............................................................ 40

Koch Hypocrisy On Reducing Prison Populations; Ties To Private Prisons, Profiting From Criminal Tracking, And Opposing Programs That Reduce Recidivism ................................................................... 41

Charles Koch Institute Described The Large Number Of People “Locked Up In Cages” Unnerving… ............................. 41 …Despite Advocating Policies That Encouraged More Incarceration ........................................................................................ 41 Koch Spending Towards Criminal Justice Reform Is Far Less Than Koch Spending For Political Campaigns .................. 44

Koch Industries Has A Criminal History KOCH INDUSTRIES HAS BEEN CONVICTED OF MULTIPLE FELONIES April 2001: Koch Petroleum Group [Now Flint Hills Resources] Was Charged In A 97-Count Indictment And Plead Guilty To A Felony Charge Of Lying To The Government About Its Benzene Emissions. According to Bloomberg Business, “A federal grand jury issued a 97-count indictment against Koch Petroleum Group, Mietlicki and three refinery managers on Sept. 28, 2000. Koch Petroleum Group pleaded guilty to a felony charge of lying to the government about its benzene emissions in April 2001.” [Bloomberg Business, 10/3/11] x Koch Industries Was Liable For $350 Million In Fines And 4 Koch Employees Faced Up To 35 Years In Prison;

Koch Petroleum Eventually Plead Guilty To One Charge Of Covering Up Environmental Violations And Paid A $20 Million Fine. According to the New Yorker, “in the final months of the Clinton Presidency the Justice Department levelled a ninety-seven-count indictment against the company, for covering up the discharge of ninety-one tons of benzene, a carcinogen, from its refinery in Corpus Christi, Texas. The company was liable for three hundred and fifty million dollars in fines, and four Koch employees faced up to thirty-five years in prison. The Koch Petroleum Group

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eventually pleaded guilty to one criminal charge of covering up environmental violations, including the falsification of documents, and paid a twenty-million-dollar fine.” [New Yorker, 8/30/10]

2002: KoSa Plead Guilty To A Felony Charge Of Conspiracy To Restrain Trade And Paid A $28.5 Million Fine. According to Bloomberg Business, “Koch Industries and a Mexican company established KoSa as a joint venture in 1998 to buy the Hoechst AG unit that produced polyester staples, which are used in making textiles. KoSa pleaded guilty in October 2002 to a felony charge of conspiracy to restrain trade and paid a $28.5 million fine.” [Bloomberg Business, 10/3/11] 1980: Federal District Judge Imposed Maximum Fines Of $50,000 Against Koch Industries And $1,000 Against Three Employees For “Tampering With Federal Oil And Gas Lease Lottery. According to the Wall Street Journal, “Federal District Judge Richard Matsch imposes maximum fines of $50,000 against Koch Industries Inc and $1,000 each against three employees for tampering with Federal oil and gas lease lottery. Also orders employees to each make three speeches before petroleum group, civic group and church group on their involvement in case (S).” [Wall Street Journal, 9/23/80] KOCH REPEATEDLY FAILED TO DISCLOSE ITS FELONY CONVICTIONS ON FEDERAL FILINGS; RESULTED IN FINE AND ADMISSION OF ERROR 2006: Koch Industries Acknowledged It Did Not Disclose Its Felony Convictions Within License Applications Filed With The FCC Before 2005. According to a FCC filing, “Koch acknowledges that in various license applications filed with the Commission since January 1, 2005, Koch Companies responded in the negative regarding whether the applicant to the application or any party thereto had ever been convicted of a felony in state or federal court. [FCC Consent Decree, 3/22/06] x The FCC Enforcement Bureau Looked Into Koch Industries’ Filings After The Company Filed “Several License

Applications In 2005 That Properly Disclosed A Prior Felony Conviction And Several Other License Applications That Did Not Disclose Such Information.” According to a FCC filing, “The Bureau acknowledges that it commenced its Inquiry upon discovering that a Koch Company had filed with the Commission several license applications in 2005 that properly disclosed a prior felony conviction and several other license applications that did not disclose such information.” [FCC Consent Decree, 3/22/06]

x FCC: “Koch Further Acknowledges That Such Representations To The Commission May Not Have Been

Accurate, Given Koch’s Prior Felony Convictions.” According to a FCC filing, “Koch further acknowledges that such representations to the Commission may not have been accurate, given Koch’s prior felony convictions.” [FCC Consent Decree, 3/22/06]

x Koch Industries Asserted That “Any Inaccurate Statements In Its Applications Appear To Have Been

Inadvertent.” According to a FCC filing, “Based on Koch’s internal review of its past application filings conducted after commencement of the Inquiry, Koch asserts that any inaccurate statements in its applications appear to have been inadvertent.” [FCC Consent Decree, 3/22/06]

Koch Industries Subsequently Disclosed To The FCC That It Had Been “Convicted Of Felonies In State Or Federal Court On Three Occasions.” According to a FCC filing, “Koch and/or Koch Companies were convicted of felonies in state or federal court on three occasions. Section 1.17 of the Commission’s rules, 47 C.F.R. S 1.17, requires truthful and accurate statements to the Commission, including such statements in response to questions in license applications which inquire whether the applicant or a party thereto has ever been convicted of a felony in state or federal court.” [FCC Consent Decree, 3/22/06] FCC Used Felony Disclosures As A Character Qualification Of Whether Applicants Would Obey The Law The FCC’s “Character Policies Provide That A Felony Conviction Is Relevant To The Evaluation Of A Licensee’s Character Qualifications, Because Felonies Are Serious Crimes That Reflect On The Licensee’s Propensity To Obey The Law.” According to a FCC letter, “The Commission has consistently applied character standards developed for broadcasters to applicants and licensees in the amateur radio service.3 The Commission’s character policies provide that a felony conviction is relevant to the evaluation of a licensee’s character qualifications, because felonies are serious crimes that reflect on the licensee’s propensity to obey the law.4” [FCC Letter, 7/29/11]

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x FCC: “The Commission’s Character Policies Provide That Any Felony Conviction Is A Matter Predictive Of

Licensee Behavior And Is Directly Relevant To The Functioning Of The Commission’s Regulatory Mission.” According to a FCC decision, “The Commission’s character policies provide that any felony conviction is a matter predictive of licensee behavior and is directly relevant to the functioning of the Commission’s regulatory mission.” [FCC Decision, 12/4/06]

Koch Industries Was Required To Pay A $75,000 Fine And Develop A Compliance Plan Koch Industries Paid A $75,000 Settlement For The Offense. According to a FCC filing, “Within five (5) business days after the Adopting Order becomes a Final Order, Koch shall make a voluntary contribution to the United States Treasury in the amount of seventy-five thousand dollars ($75,000). The payment shall be made by check or similar instrument, payable to the order of the Federal Communications Commission. […]The Parties agree that this Consent Decree and Koch's voluntary contribution are for settlement purposes only and do not constitute an admission, denial, adverse finding, adverse final action, adverse adjudication on the merits, or waiver of legal rights except as otherwise expressly set forth herein.” [FCC Consent Decree, 3/22/06] Koch Industries Also Developed A Compliance Plan That Sought To Ensure Future Compliance. According to a FCC filing, Koch represents that it has conducted a thorough review of its application procedures and developed a comprehensive Compliance Plan to ensure its future compliance with 47 C.F.R. S 1.17. A summary of Koch’s Compliance Plan is attached hereto. Koch agrees to implement its Compliance Plan, to the extent it has not already done so, within thirty (30) days of the Effective Date and to keep such Compliance Plan in effect for two (2) years after the Effective Date. [FCC Consent Decree, 3/22/06] After Failing To Disclose Felony History, Koch Industries Acknowledged Crimes To FCC Koch Industries Manipulated A BLM Lease Lottery Koch Industries Disclosed To The FCC That They Were Sentenced To A $50,000 Fine By The U.S. District Court Of Colorado; The Fine Was Pursuant To A Plea Agreement Over Manipulation Of A Bureau Of Land Management Lottery For Oil And Gas Leases. According to a FCC filing, “Felony Conviction Felony Plea of Koch Industries Inc. On September 19, 1980, Koch Industries, Inc., an entity that indirectly controls Koch Knight LLC was sentenced to a $50,000 fine by the U.S. District Court for the District of Colorado. The sentence was the result of Koch Industries plea agreement resolving charges that it and other defendants had manipulated a lottery administered by the Federal Bureau of Land Management by submitting more applications for oil and gas leases than the rules permitted. Counsel for Koch Industries recently became aware of the 1980 guilty plea in connection with responding to an FCC Enforcement Bureau inquiry concerning other radio licenses (FCC File No. EB-05- 1 H 0717).” [FCC Form 601 – Koch Knight LLC, Accessed 9/17/15] Koch Industries Lied To Investigators About Environmental Controls Flint Hills Resources Disclosed To The FCC That They Were “Sentenced To A Fine, A Community Service Payment, And A Term Of Five Years Probation By The United States District Court For The Southern District Of Texas, Corpus Christi Division” In 1995. According to a FCC filing, “On April 9, 2001, Flint Hills Resources, LP, an entity that indirectly controls KPL, was sentenced to a fine, a community service payment, and a term of five years probation by the United States District Court for the Southern District of Texas, Corpus Christi Division. […]The conduct for which the company was sentenced occurred in 1995.” [FCC Form 601 – Flint Hills Resources, Accessed 9/17/15] x “The Sentence Was The Result Of Flint Hills Resources, LP’s Plea Agreement For One Felony Violation For

False Statements In Connection With The Failure To Measure Levels Of A Regulated Chemical After A Control Device Had Been Disconnected.” According to a FCC filing, “The sentence was the result of Flint Hills Resources, LP’s plea agreement for one felony violation for false statements in connection with the failure to measure levels of a regulated chemical after a control device had been disconnected.” [FCC Form 601 – Flint Hills Resources, Accessed 9/17/15]

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Koch Industries Was Part Of A Price Fixing Conspiracy To Eliminate Competition KoSa Disclosed That It Plead Guilty In 2002 To A Price Fixing Conspiracy For Polyester Staple And Paid A $28.5 Million Criminal Fine. According to a FCC filing, “A business controlled by the applicant, formerly known as Arteva Specialties, d/b/a KoSa, and a former Arteva employee were charged with participating in a conspiracy to suppress and eliminate competition by fixing the price of, and allocating customers for, polyester staple sold in North America between September 1999 and January 2001. Polyester staple is a petroleum-based fiber that is used in the manufacture of a variety of consumer products. Arteva Specialties pled guilty in December 2002 in accordance with a plea agreement to the only charge in the information. The parties jointly recommended and the court sentenced Arteva Specialties to a $28.5 million criminal fine with no probation. The amount of the fine represented a downward departure from the fine range set out in the sentencing guidelines in effect at the time. The government agreed to the downward departure because of Arteva Specialties’ substantial assistance in the government’s investigation.” [FCC Filing Attachment, 4/19/06] Prior To Being Owned By Koch Industries, Georgia Pacific Evaded Taxes Georgia Pacific Disclosed That In 1991 It Pled Guilty To Tax Evasion And Paid “$16 Million For The Tax Deficiency, Interest And Civil Penalties, Plus A Separate $5 Million Fine.” According to a FCC filing, “In late 1991, Georgia-Pacific settled a tax dispute with the United States regarding its donation of 5,400 acres of land to a water management district in Northern Florida. Georgia Pacific agreed to plead guilty to a criminal offense of tax evasion and pay $16 million for the tax deficiency, interest and civil penalties, plus a separate $5 million fine.” [FCC Filing Attachment, 6/19/06] Koch Industries Failed To Disclose Its Felony Convictions At Least 43 Times Koch Exploration In 2002, Koch Exploration Indicated That They Were Not Associated With A Felony Conviction On A FCC License Filing. According to a FCC filing, Koch Exploration answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 1/4/02] x In 2006, Koch Exploration Changed Their Answer To Yes, They Had Been Associated With A Felony

Conviction. According to a FCC filing, Koch Exploration answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 8/31/06]

Koch Membrane Systems In May Of 2009, Koch Membrane Systems Did Not Disclose That They Were Associated With A Felony Conviction In An FCC License Modification. According to a FCC filing, Koch Membrane Systems answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 5/11/09] x In July Of 2006, Koch Membrane Systems Disclosed That They Were Associated With A Felony Conviction In A

FCC License Filing. According to a FCC filing, Koch Membrane Systems answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 7/27/06]

x In October Of 2009, Koch Membrane Systems Disclosed That They Were Associated With A Felony Conviction

In A FCC License Filing. According to a FCC filing, Koch Membrane Systems answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 7/27/06]

Koch Membrane Systems Said That The Question Was Answered Incorrectly “Due To An Oversight.” According to a FCC filing, “KMS filed a request for modification on May 11, 2009 and indicated on the Form 601 that neither it nor any

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party directly or indirectly controlling the applicant had ever been convicted of a felony by any state or federal court. In the original license application, KMS correctly answered this question in the affirmative and included an explanation of the 1980 felony conviction of Koch Industries, Inc., which indirectly controls KMS. However, when it filed the modification application, the question was answered in the negative due to an oversight. In this filing, KMS responds to this question correctly in the affirmative to reflect the Koch Industries, Inc. plea.” [FCC Filing, 7/27/06] Flint Hills Resources In January Of 2002, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 1/15/02] In April Of 2002, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Three Times. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 4/19/02; 4/19/02; 4/25/02] In June Of 2002, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 6/13/02] In February Of 2003, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 2/4/03; 2/7/03] In March Of 2003, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Three Times. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 3/6/03; 3/10/03; 3/12/13] In April Of 2003, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 4/9/03; 4/16/03] In May Of 2003, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 5/5/03; 5/16/03] In February Of 2004, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 2/25/04] In January Of 2005, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 1/3/05] In March Of 2005, Flint Hills Resources Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a no: “Has the

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Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 3/30/05] In March of 2005, Flint Hills Resources Disclosed That They Were Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Flint Hills Resources answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 5/23/05] Koch Petroleum Group In August Of 2001, Koch Petroleum Group Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Petroleum Group answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 8/14/01] In November Of 2001, Koch Petroleum Group Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Petroleum Group answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 11/02/01] Koch Industries In August Of 2002, Koch Industries Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Industries answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 8/9/02] x In December Of 2005, Koch Industries Changed Their Answer To Yes, They Had Been Associated With A

Felony Conviction. According to a FCC filing, Koch Industries answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC License Modification, 12/19/05]

Koch Nitrogen In July Of 2003, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 7/18/03] In August Of 2003, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 8/11/03] In September Of 2003, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Three Times. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 9/19/03; 9/26/03; 9/29/03] In October Of 2003, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 10/06/03; 10/31/03] In November Of 2003, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the

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Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 11/24/03] In January Of 2004, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 1/06/04; 1/20/04] In February Of 2004, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 2/12/04] In June Of 2004, Koch Nitrogen Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Koch Nitrogen answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 6/29/04; 6/4/04] x In October Of 2006, Koch Nitrogen Disclosed That They Were Associated With A Felony Conviction In A FCC

License Filing. According to a FCC filing, Koch Nitrogen answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 10/12/06]

INVISTA S.A.R.L. In August Of 2004, INVISTA S.A.R.L. Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, INVISTA S.A.R.L. answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 8/27/04] In December Of 2004, INVISTA S.A.R.L. Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, INVISTA S.A.R.L. answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 12/9/04] In March Of 2005, INVISTA S.A.R.L. Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, INVISTA S.A.R.L. answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 3/18/05] In April Of 2005, INVISTA S.A.R.L. Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, INVISTA S.A.R.L. answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 4/6/05] x In April Of 2006, INVISTA S.A.R.L. Changed Their Answer To Yes, They Had Been Associated With A Felony

Conviction. According to a FCC filing, INVISTA S.A.R.L. answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC License Modification, 4/19/06]

Koch Performance Asphalt In August Of 2001, Koch Performance Asphalt Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Performance Asphalt answered the following question with a no:

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“Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 8/1/01] In October Of 2003, Koch Performance Asphalt Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Koch Performance Asphalt answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 10/23/03] Matador Cattle Company In April Of 2001, Matador Cattle Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Matador Cattle answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 4/10/01] In May Of 2001, Matador Cattle Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Matador Cattle answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 5/15/01] In July Of 2001, Matador Cattle Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Matador Cattle answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 7/24/01] In November Of 2011, Matador Cattle Changed Their Answer To Yes, They Had Been Associated With A Felony Conviction. According to a FCC filing, Matador Cattle answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC License Modification, 11/21/11] Georgia Pacific In January Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 1/6/05] In February Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 2/10/05] In May Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 5/23/05; 5/27/05] In July Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 7/8/05] In August Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing Twice. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 8/18/05; 8/22/05]

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In September Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 9/7/05] In October Of 2005, Georgia Pacific Indicated That They Were Not Associated With A Felony Conviction In A FCC License Filing. According to a FCC filing, Georgia Pacific answered the following question with a no: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FEC Filing, 10/21/05] x In June Of 2006, Georgia Pacific Disclosed That They Were Associated With A Felony Conviction In A FCC

License Filing. According to a FCC filing, Georgia Pacific answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC License Application, 6/19/06]

At Least One Koch Industries Entity Indicated Prior To 2006 That It Had Been Associated With A Felony Conviction Arteva Specialties S.A.R.L. In February Of 2004, Arteva Specialties S.A.R.L. Answered Said That They Had Been Associated With A Felony Conviction In FCC Filings Twice. According to a FCC filing, Arteva Specialties S.A.R.L. answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 2/24/04; 2/27/04] x The “Real Party In Interest” For The Arteva Specialties S.A.R.L. Filing Was Listed As Koch Industries Inc.

[FCC Filing, 2/24/04] In March Of 2004, Arteva Specialties S.A.R.L. Said That They Had Been Associated With A Felony Conviction In FCC Filings. According to a FCC filing, Arteva Specialties S.A.R.L. answered the following question with a yes: “Has the Applicant or any party to this application or amendment, or any party directly or indirectly controlling the Applicant, ever been convicted of a felony by any state or federal court?” [FCC Filing, 3/2/04] Koch Companies Also Gave Incorrect Information On SEC Disclosure Filings Koch Agriculture Company In 2001, Koch Agriculture Company Disclosed To The SEC That It Had Not In The Last Five Years “Been Convicted In A Criminal Proceeding (Excluding Traffic Violations Or Similar Misdemeanors).” According to a Koch Agriculture Company Schedule 13D filing with the SEC, “(d) Neither KAC, nor any person listed on (c)(1) has during the last five (5) years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). Neither Koch, nor any person listed on (c)(2) has during the last five (5) years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).” [Koch Agriculture Company Schedule 13D Filing, 5/22/01] Koch Investment Group Limited Company In 2001, Koch Investment Group Limited Company To The Sec That It Had Not In The Last Five Years “Been Convicted In A Criminal Proceeding (Excluding Traffic Violations Or Similar Misdemeanors).” According to a Koch Investment Group Limited Schedule 13D filing with the SEC, “Neither KIGL, nor any person listed on (c)(1) has during the last five (5) years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). Neither Koch, nor any person listed on (c)(2) has during the last five (5) years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).” [Koch Investment Group Limited Schedule 13D Filing, 5/21/01]

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Criminal And Potentially Criminal Activity Related To Koch Industries Including Environmental Violations, Workplace Accidents, And Improper Business Practices KOCH INDUSTRIES HAS A HISTORY OF ENVIRONMENTAL VIOLATIONS, HARMING OUR AIR, WATER, AND LAND, AND HAS PAID ALMOST $94 MILLION IN FINES AND SETTLEMENTS Flint Hills Resources (Formerly Koch Petroleum) Faced A 97-Count Indictment For Covering Up Benzene Discharge AP: “Koch Petroleum Group And Its Parent, Koch Industries Inc., Have A Long History Of Environmental Problems.” According to the Associated Press State & Local Wire, “Koch Petroleum Group and its parent, Koch Industries Inc., have a long history of environmental problems. Last year, the petroleum group pleaded guilty to covering up violations of federal air-pollution laws and agreed to pay a $20 million fine. In 2000, the parent company settled a case involving oil leaks in six states with a record $35 million payment to the government. It also pleaded guilty and paid an $8 million penalty in Minnesota after discharging oil from its Pine Bend refinery into streams.” [Associated Press State & Local Wire, 1/14/02] 2000: Koch Industries Was Charged With 97 Counts For Covering Up The Discharge Of Benzene In Corpus Christi Koch Industries Faced A 97-Count Indictment For Covering Up The Discharge Of 91 Tons Of Benzene From Its Corpus Christi Refinery And Four Koch Employees Faced Up To 35 Years In Prison. According to the New Yorker, “in the final months of the Clinton Presidency the Justice Department levelled a ninety-seven-count indictment against the company, for covering up the discharge of ninety-one tons of benzene, a carcinogen, from its refinery in Corpus Christi, Texas. The company was liable for three hundred and fifty million dollars in fines, and four Koch employees faced up to thirty-five years in prison. The Koch Petroleum Group eventually pleaded guilty to one criminal charge of covering up environmental violations, including the falsification of documents, and paid a twenty-million-dollar fine.” [New Yorker, 8/30/10] Federal Prosecutor David Uhlmann: The Lawsuit Against Koch Petroleum Group For Violating The Clean Air Act Was A “Classic Case Of Environmental Crime.” According to the Washington Post, “Liberal watchdog group Bridge Project last month released a report, ‘The Koch Brothers’ Criminal Justice Pump-Fake,’ attacking their work on criminal justice issues, saying the Kochs’ interest in reform stems from a 97-count indictment and prosecution charging the Koch Petroleum Group and several employees with violating the Clean Air Act at its refinery in Corpus Christi, Tex. David Uhlmann — the federal prosecutor who was head of the environmental crimes section of the Justice Department — described the lawsuit as ‘a classic case of environmental crime: illegal emissions of benzene — a known carcinogen — at levels 15 times greater than those allowed under federal law.’” [Washington Post, 8/15/15] x Uhlmann: Koch Admitted That Its Employees “Engaged In An Orchestrated Scheme To Conceal The Benzene

Violations From State Regulators.” According to the Washington Post, “‘Koch pleaded guilty and admitted that its employees engaged in an orchestrated scheme to conceal the benzene violations from state regulators and the Corpus Christi community,’ said Uhlmann, now a law professor at the University of Michigan Law School.” [Washington Post, 8/15/15]

Koch Petroleum Plead Guilty To Covering Up Environmental Violations At Its Corpus Christi Plant Koch Petroleum Group Plead Guilty In April 2001 To Covering Up Environmental Violations At Its Corpus Christi West Plant. According to the Corpus Christi Caller-Times, “Koch Petroleum Group pleaded guilty in April to covering up environmental violations at its Corpus Christi west plant, and agreed to a record punishment: A $10 million fine and a judge's order to perform $10 million worth of environmental projects in the Coastal Bend.” [Corpus Christi Caller-Times, 12/30/01] A Federal Judge Considered Environmental Projects Proposed By Flint Hills Resources Which Was Convicted Of Environmental Violations In Corpus Christi And Ordered To Invest $10 Million Into Environmental Projects.

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According to the Associated Press State & Local Wire, “A federal judge is considering environmental improvement projects proposed by a company convicted of environmental violations in Corpus Christi. Koch Petroleum Group, now known as Flint Hills Resources, has been ordered to invest $10 million in environmental improvement projects in the coastal city. On Friday, the company proposed three such projects to U.S. District Judge Janis Graham Jack. Jack ordered the company back to court next month so she has time to consider if the projects merit a portion of the money the Wichita, Kan.-based company has been ordered to pay.” [Associated Press State & Local Wire, 5/18/02] Koch Petroleum Paid The Fines Immediately, And Absolved Itself Of Any Further Monetary Liability. According to the Associated Press State & Local Wire, “Company officials said people and the environment weren't harmed. Their Corpus Christi complex employs more than 900 and can process 300,000 barrels of oil per day. Under terms of the order, the environmental fund must be used for air and water quality projects. Koch paid the fines immediately, absolving itself of any further monetary liability. Two cashier's checks totaling $20 million were turned over to the court. ‘We did everything at that moment,’ company attorney Tony Canales said in Sunday's editions of the Corpus Christi Caller-Times.” [Associated Press State & Local Wire, 4/7/02] Charles Koch Trumpeted That Koch Avoided Majority Of Charges Because Of Technicality Related To Wastewater Sampling Requirements Charles Koch On The Case: “An Environmental Protection Agency’s Investigator” Admitted The Samples Collected By The “Whistle-Blower” Were Unreliable. According to Charles Koch in his book “Good Profit,” “The government’s case ultimately collapsed a few weeks before trial in a hearing before a federal judge, after Koch finally had an opportunity to challenge the government’s key expert witness: an Environmental Protection Agency investigator who admitted the wastewater samples collected by the ‘whistle-blower’ and used as evidence of KPG’s noncompliance were unreliable, as their collection was not consistent with EPA requirements for sampling. Other than the information Koch supplied as part of its voluntary self-disclosure to the Texas environmental agency, the DOJ did not provide any other support for its allegations. And so all of the charges against Koch and the four indicted employees were dismissed. In April 2001, KPG pled guilty to one new single count— the false report made by the former employee it had disclosed in November 1995. The government made the four innocent employees sign an agreement promising not to sue for malicious prosecution, as a condition of dropping the charges against them. Though they were ultimately exonerated, what happened to these four employees was beyond the pale.” [Charles Koch – “Good Profit”, 10/15] Colonial Pipeline 2003: Colonial Pipeline Paid $34 Million, One Of The Largest Civil Penalties At The Time, To Settle EPA Lawsuit 2003: Colonial Pipeline Agreed To Pay $34 Million In One Of The Largest Civil Penalties At The Time, On Behalf Of The EPA Lawsuit. According to the Oil & Gas Journal, “Colonial Pipeline agreed in March 2003 to pay $ 34 million in one of the largest civil penalties ever levied in a lawsuit on behalf of the US Environmental Protection Agency Agency (OGJ, Apr. 7, 2003, p. 9) […] That agreement settled an action brought as a result of several events.” [Oil & Gas Journal, 8/18/03] x “The Most Notable Occurred In 1996 Along The Reedy River In South Carolina Where A Spill Of More Than

22,000 Bbl Of Diesel Fuel Killed Thousands Of Fish And Wildlife.” According to Oil & Gas Journal, “That agreement settled an action brought as a result of seven events. The most notable occurred in 1996 along the Reedy River in South Carolina where a spill of more than 22,000 bbl of diesel fuel killed thousands of fish and other wildlife.” [Oil & Gas Journal, 8/18/03]

x Colonial Pipeline Was Also Penalized For Spills At Groose Creek, Tennessee; Bear Creek, Georgia; And Darling Creek Louisiana. According to the New York Times, “In addition to Reedy River, the other major spills for which Colonial Pipeline is being penalized include one in 1999 in Goose Creek, Tenn.; another in 1997 at Bear Creek, Ga.; and continual leaks at Darling Creek, La.” [New York Times, 4/2/03]

x Colonial Pipeline Was Also Required To Spend $30 Million To Upgrade Environmental Protections And Treat

Its Entire System As Operating in federally defined, “High Consequence Areas.” According to the Oil & Gas Journal, “[President and CEO of Colonial Pipeline David] Lemmon said that as onerous as is the civil penalty, the other part of the settlement -- a commitment of $ 30 million to upgrade environmental protections along Colonial's system --

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actually represents ‘specific actions that we're already taking , , , [in] our 10-year plan and [money] already in our budget’ […] Another major part of the agreement requires Colonial to treat its entire system -- all 5,500 miles of it -- as operating in federally defined ‘high consequence areas.’ These HCAs are populated areas, areas unusually sensitive to environmental damage, and commercially navigable waterways (OGJ, Mar. 24, 2003, p. 74). Operating in HCAs requires more-frequent pipeline inspections and more prompt reporting of inspection results, among other potentially expensive implications.” [Oil & Gas Journal, 8/18/03]

Koch Supply And Trading (Formerly Koch Oil) Settled A Lawsuit After Being Accused Of Unlawful Practices Fouling The Air And Spilling Oil 1999: Kern County, CA, Koch Paid $500,000 To Settle A Lawsuit For Fouling The Air And Spilling Oil Koch Oil Agreed To Pay A $500,000 Fine To Settle A Lawsuit That Alleged, “The Company Fouled The Air And Spilled Oil At Its Former Natural Gas Plant In Kern County. According to the Associated Press, “Koch Oil Inc. has agreed to pay a $500,000 fine to settle a lawsuit that alleged the company fouled the air and spilled oil at its former natural gas plant in Kern County.” [Associated Press, 7/14/00] The Lawsuit Accused Koch Of, “Unlawful Business Practices, Violating the Air Resources Act And The Health And Safety Code And Intentionally Allowing Illegal Release Of Contaminants.” According to the Associated Press, “The lawsuit, filed in May 1999 by an air pollution compliance board and the Kern County District Attorney's office, accused Koch of unlawful business practices, violating the Air Resources Act and the Health and Safety Code and intentionally allowing illegal release of contaminants.” [Associated Press, 7/14/00] Prior To Koch Acquiring A Controlling Interest In 2002, Colonial Pipeline Had A History Of Problems And Spills 2000: Multi-state: EPA Brought Suit Against Colonial Pipeline For 3 Million Gallons Of Oil Spilled Over 20 Years 2000: The Department Of Justice, On Behalf Of The EPA, Filed Suit Against Colonial Pipeline For 3 Million Gallons Of Spilled Oil Over 20 Years. According to the Oil & Gas Journal, “In late November 2000, the US Justice Department, on behalf of the EPA, filed suit against Atlanta-based Colonial Pipeline Co. in a move that could drastically extend the 5-year statute of limitation on violations of the Clean Water Act. Justice attorneys claim Colonial demonstrated a ‘pattern and practice’ of spills totaling some 3 million gal of oil and petroleum products from its 5,349-mile pipeline over the last 20 years.” [Oil & Gas Journal, 2/12/01] x The Lawsuit Charged That Pipeline Corrosion, Mechanical Damage, And Operator Error Resulted In

Numerous Spills By The Pipeline. According to the Oil & Gas Journal, “The federal lawsuit against Colonial charges that pipeline corrosion, mechanical damage, and operator error resulted in numerous spills by the pipeline in Louisiana, Alabama, Georgia, Tennessee, South Carolina, North Carolina, Maryland, Virginia, and New Jersey.” [Oil & Gas Journal, 2/12/01]

The DOJ Also Pursued Civil Penalties Under The Clean Water Act. According to Oil & Gas Journal, “Justice also is seeking significant civil penalties from Colonial Pipeline under the Clean Water Act. The act authorizes civil penalties of up to $ 25,000/day of violation before January 1997, and $ 27,500/day for each day thereafter, or $ 1,000/bbl of oil spilled or $ 3,000/bbl in the case of ‘gross negligence.’” [Oil & Gas Journal, 2/12/01] 1999: South Carolina, Clean Water Violation Colonial Pipeline Was Fined $7 Million For A Leak That Polluted The Reedy River In South Carolina With 4 Million Liters Of Diesel Fuel. According to the National Post, “Colonial Pipeline, the largest U.S. pipeline company, has been fined $7-million (US) for a leak that polluted a South Carolina [Reedy] river with about four million litres of diesel fuel. The company was fined Thursday after pleading guilty to violating the federal Clean Water Act for the 1996 spill that killed 35,000 fish, prosecutors said. Thursday's fine comes on top of more than $13-million US the company already agreed to pay to the state and affected landowners along the river.” [National Post, 2/27/99]

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x River Reedy Incident Was A “Wake-UP Call” For Colonial Pipeline To Become “Leak And Spill Free.” According to the Oil & Gas Journal, “The Reedy River incident was a ‘wake-up call’ for Colonial, said Lemmon, and prompted the company within 2 years to overhaul its management to improve operations. Colonial's goal became being ‘leak free and spill free,’ he said. Company data indicate Colonial's improvement has been dramatic: The company reduced its spill volume to only 16 bbl in 2002 from the level represented by the 1996 spill. Over the 5 years since 1998, its spills have averaged 694 bbl/year.” [Oil & Gas Journal, 8/18/03]

1995: One Hundred Twenty People Injured In Texas Fuel Spill Fire Two Colonial Pipelines Buried Under the San Jacinto River Ruptured And Spilled Gasoline And Diesel Fuel Caught Fire; 120 People Were Injured. According to the Associated Press, “Last year [1995], two Colonial pipelines buried under the San Jacinto River near Houston, Texas ruptured after heavy rains, spilling gasoline and diesel fuel. Tremendous explosions sent flames racing down the river; about 120 people suffered minor injuries.” [Associated Press, 6/27/96] x Thousands Of Gallons Of Gasoline Poured Into The San Jacinto River. According to the Houston Chronicle,

“More recently - though not cited by the safety board - thousands of gallons of unleaded gasoline poured from another burst Colonial pipeline into the San Jacinto River in Houston and ignited, creating a torrent of flames.” [Houston Chronicle, 1/24/96]

Colonial Pipeline Was Hit With Over 7,000 Claims For Property And Emotional Damages From The Fire And Petroleum. According to the Houston Chronicle, “Numerous homes, boats, garages, vehicles and storage sheds were damaged. Colonial Pipeline was hit with 4,554 claims from individuals alleging bodily or emotional damages and 2,929 claims from people who said their property was damaged by soot, fire or petroleum product deposits.” [Houston Chronicle, 10/14/95] x Colonial Pipeline Estimated The Total Cost Of Damages And Repairs At $15 Million. According to the Houston

Chronicle, “Colonial Pipeline estimates the total cost of damages is approximately $ 10 million and an additional $ 5 million for the construction of a new deep directional pipeline crossing,'' the report says.” [Houston Chronicle, 10/14/95]

1991: 420,000 Gallons Of Oil Spilled In Durbin Creek, South Carolina 1991: Colonial Pipeline’s Line 2 Ruptured And Spilled 13,100 Barrels Of Fuel Into Durbin Creek, South Carolina. According to Oil & Gas Journal, “Line 2 ruptured Dec. 19, 1991, spilling 13,100 bbl of fuel oil into Durbin Creek, about 2.8 miles northeast of the company's Simpsonville, S.C., pump station. It caused environmental pollution on 26 miles of waterways, including the Enoree River, and forced the towns of Clinton and Whitmire to use other water supplies.” [Oil & Gas Journal, 3/14/94] 1991: Colonial Pipeline Fixed The Ruptured Pipeline In South Carolina That Spilled 420,000 Gallons Of Fuel Into Little Durban Creek. According to the New York Times, “Oil was moving again today in a pipeline that ruptured last week, spilling 420,000 gallons of fuel into Little Durbin Creek. A spokesman for the Colonial Pipeline Company said its workers had recovered most of the oil, which began spilling Thursday.” [New York Times, 12/24/91] 1993: 400,000 Gallons Of Oil Spilled In Sugarland Run, Virginia 1993: Colonial Pipeline Ruptured And Approximately 400,000 Gallons Of Diesel Fuel Spilled Into Sugarland Run. According to the Washington Post, “The agreement is the result of the spill of approximately 400,000 gallons of diesel fuel that gushed from a ruptured Colonial oil line right behind Reston Hospital in March 1993. Most of the spill made its way into nearby Sugarland Run, a stream that feeds the Potomac River.” [Washington Post, 10/23/97] x The Spill Contaminated The Air, Forced Fairfax County To Stop Taking Tap Water From The Area, And Traces

Were Found 50 Miles Away. According to the Washington Post, “The spill sent up a 100-foot oil geyser, contaminated the air with diesel fumes and forced Fairfax County to temporarily stop taking its tap water from the area. The waterways for several miles downstream were covered with the brown spilled liquid and traces of it could be found on shorelines as far as 50 miles away. Most of the oil eventually was recovered after three days of cleanup.” [Washington Post, 10/23/97]

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x National Transportation Safety Board Couldn’t Pinpoint Cause Of Pipeline Rupture. According to the Washington Post, “The National Transportation Safety Board said it is unable to pinpoint who caused last year's oil pipeline rupture in Reston, and it has launched an industry-wide pipeline safety investigation as a result of that accident.” [Washington Post, 3/8/94]

x NTSB Suspected A Crack Caused By Construction Equipment Caused Crack In Pipeline; But Could Not

Determine Who Caused The Damage Or When. According to the Washington Post, “The transportation safety board's investigation quickly established a probable cause: Heavy construction equipment scraped the pipe, causing a six-inch crack that widened over time, eventually splitting into a 42-inch rupture. Several long scrape marks were found near the break. But after nearly a year of examining metal tests and combing through construction records, the agency said it could not determine who did the damage and when. ” [Washington Post, 3/8/94]

Colonial Pipeline Spokesman Chris Crowley: “We'll Pay Any And All Expenses Directly Related To The Spill Response And Cleanup.” According to the Washington Post, “‘We'll pay any and all expenses directly related to the spill response and cleanup,’ said Colonial spokesman Chris Crowley. "We have been right along. Those bills are still coming in, and we'll pay them as they do.” [Washington Post, 8/12/93] x Loudon, Virginia Planned To Bill Colonial Pipeline $65,000 For County Expenses Related To The Oil Spill Into

Sugarland Run. According to the Washington Post, “Loudoun officials say they plan to bill Colonial Pipeline Co. for about $ 65,000 next week for county government expenses related to the March 28 oil spill into Sugarland Run […]. The proposed reimbursement would cover Colonial's use of county materials, wear and tear of county vehicles and the time of county employees, including fire and rescue and animal control personnel.” [Washington Post, 8/12/93]

x Colonial Pipeline Reimbursed Fairfax County $247,425 For Expenses Related To The Spill. According to the

Washington Post, “Last week, Colonial reimbursed Fairfax County $ 247,425 for its expenses related to the spill.” [Washington Post, 8/12/93]

x Northern Virginia Regional Park Authority Presented Colonial Pipeline With A Bill For Nearly $500,000 For

Expenses Related To The Spill. According to the Washington Post, “The Northern Virginia Regional Park Authority presented Colonial six weeks ago with its own bill for nearly $ 500,000. That sum includes reimbursement for damage to Algonkian Regional Park and loss of revenue during a period when the park was closed and served as a primary staging area for Colonial's cleanup effort.” [Washington Post, 8/12/93]

Colonial Pipeline Paid $3.6 Million To Virginia After Spill, In Addition To Payments To Fairfax County 1997: Colonial Pipeline Agreed To Pay $3.6 Million To Virginia After Oil Spill. According to the Washington Post, “The company (Colonial Pipeline) that operated a pipeline that burst four years ago in Reston, causing one of the area's worst oil spills, has agreed to a tentative $ 3.6 million settlement that includes money for projects as diverse as new walking trails, nature observation decks, stream bank repairs and wetlands improvement.” [Washington Post, 10/23/97] x The Settlement Included $2 Million For 17 Restoration Projects Throughout Northern Virginia. According to the

Washing Post, “ After two years of negotiations with the Virginia and U.S. governments over its liability in the spill, Colonial Pipeline Co. has agreed to pay about $ 2 million for 17 restoration projects throughout Northern Virginia. They include construction of walking and biking paths in Herndon and at Loudoun County's Algonkian Regional Park, improved wildlife viewing facilities at Dyke Marsh Wildlife Preserve just south of Alexandria, and restoration of natural habitats near Sugarland Run. Also included in that amount is more than $ 100,000 to reimburse Virginia for its costs in cleaning up after the accident.” [Washington Post, 10/23/97]

x The Settlement Included $1.5 Million As A Civil Penalty. According to the Washington Post, “The settlement would

also have Colonial pay $ 1.5 million as a civil penalty, money that would be split in half by the state and the federal government.” [Washington Post, 10/23/97]

x Colonial Pipeline Had To Improve Wetlands And Other Natural Habitats. According to the Washington Post, “In

the Sugarland Run Stream Valley Park in Fairfax County, the agreement calls for Colonial to try to improve wetlands and other natural habitats. The company would plant clusters of nursery-grown shrubs, for example, in various locations to

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give small animals and birds extra cover. Also, other areas would be reforested, with native hardwood trees and other plantings, and steps would be taken to improve water quality.” [Washington Post, 10/23/97]

Virginia Residents Sued Colonial Pipeline For $5 Million Over 400,000 Gallons Of Fuel That Spilled Into Sugarland Run. According to the Washington Post, “Seven Loudoun and Fairfax County property owners filed a $ 5 million claim against Colonial Pipeline last week, alleging that the company could have done more to prevent the massive March 28 diesel fuel leak they say has lowered their property values. More than 400,000 gallons of fuel gushed into Sugarland Run, a tributary of the Potomac, when one of Colonial's transcontinental pipelines ruptured behind Reston Hospital. Most of the oil was recovered within three days, but not before it caused substantial soil and water contamination along about seven miles of the creek.” [Washington Post, 8/5/93] x The Lawsuit Claimed, “That Colonial Has Unjustly Profited By Not Spending The Money Necessary To

Ensure That The Pipeline Would Not Be Struck By Heavy Equipment Or Subject To Other Conditions That Could Cause A Rupture.” According to the Washington Post, “The class-action suit, which was brought by the seven property owners on behalf of as many as 2,300 area residents, was filed July 27 in Loudoun County Circuit Court. It claims that Colonial has unjustly profited ‘by not spending the money necessary to ensure that the pipeline would not be struck by heavy equipment" or subject to other conditions that could cause a rupture.’” [Washington Post, 8/5/93]

Colonial Pipeline Contended That The Pipeline Burst Due To A Third Party When The Pipeline Was Installed In 1980. According to the Washington Post, “Colonial officials said the pipeline ruptured because of damage done to it by construction equipment used by a third party after the pipeline was installed in 1980.” [Washington Post, 8/5/93] Colonial Pipeline Rejected Government’s Call To Do More To Prevent Spills. According to the Washington Post, “Federal, state and local officials told Congress yesterday that the pipeline rupture that caused a major oil spill in Reston proves that industry must be required to do more to prevent spills or reduce the damage they can cause. But the president of Colonial Pipeline Co., whose line released more than 400,000 gallons of diesel into a Potomac River tributary two months ago, rejected that argument.” [Washington Post, 5/19/93] Rep. Leslie L Bryne (D-VA): “It's Cheaper To Let It Leak Than For Industry To Take Steps To Prevent Pipeline Spills.” According to the Washington Post, “After the hearing before a House Public Works and Transportation subcommittee, Rep. Leslie L. Byrne (D-Va.) said testimony by Colonial officials indicated that they believe ‘it's cheaper to let it leak’ than for industry to take steps to prevent pipeline spills. She cited testimony by Brinkley that Colonial has spent up to $50 million recently on pipe inspections using electronic devices and $ 3.5 million so far on the Reston cleanup.” [Washington Post, 5/19/93] MULTIPLE DEATHS HAVE BEEN REPORTED RELATED TO KOCH PROPERTY AND FACILITIES A Koch Pipeline Exploded Because Of Corrosion That Koch Was Aware Of 1996: Two Teenagers Killed In Texas Explosion In 1996, Two Texas Teenagers, Danielle Smalley And Her Friend Jason Stone, Were Burned To Death After A “Decrepit” Koch Pipeline Exploded, After The Teens Started The Ignition Of Their Truck. According to Salon.com, “On Aug. 24, 1996, near Lively, Texas, Danielle Smalley and her friend Jason Stone were burned to death after a decrepit Koch pipeline exploded after the teens started the ignition of their truck. The feds documented ‘severe corrosion’ and ‘mechanical damage’ in the pipeline. Koch Pipeline Company LP failed to ‘adequately protect its pipeline from corrosion,’ a National Transportation Safety Board report would state. After a lengthy trial, Koch Industries was ordered to pay the Smalley family $296 million, then the largest wrongful-death judgment in American legal history. The family would later settle with Koch for an undisclosed sum.” [Salon.com, 10/1/14] National Transportation Safety Board Report: The Rupture Site Of The Pipeline Exhibited “Severe Corrosion” And It Was Possible That Corrosion Was “Underreported.” According to the National Transportation Safety Board’s report, “A possible explanation for the pipeline’s rapid corrosion and failure in 15 months was that the 1995 internal inspection significantly underreported pipe-wall-thickness loss at the rupture site. […] In addition, about 15 lengths of pipe in a 10-mile

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section around the rupture site were graded as exhibiting severe corrosion by the September 1996 internal inspection performed a month after the accident.” [National Transportation Safety Board Pipeline Accident Summary Report, “Pipeline Rupture, Liquid Butane Release, And Fire, Lively, Texas, August 24, 1996,” accessed 10/23/15] x Smalley And Stone Were On Their Way To Report A Gas Leak In Koch’s Butane Pipeline When They Were

Killed By The Explosion Of The Pipeline. According to the Topeka Capital Journal, “Court records from a lawsuit filed after the deadly August 1996 pipeline explosion in the small northeast Texas town of Lively show that Wichita, Kan.-based Koch knew about problems with the pipeline that ran through the area but continued to operate it. Danielle Smalley and her friend Jason Stone, both 17, were on their way to report a gas leak in the butane pipeline when their truck apparently ignited the fumes, killing them both. Senior Koch officials insisted that the pipeline ruptured without warning.” [Topeka Capital Journal, 7/24/01]

x Court Records Indicated That Corrosion Problems With The Pipeline Started “Virtually” When The Pipeline

Was Installed In 1981. According to the Topeka Capital Journal, “Court records from the Smalley lawsuit show the corrosion problems with the pipeline started virtually when the pipeline was installed in 1981. The pipeline runs for 570 miles from Medford, Okla., to Mont Belvieu, east of Houston. Corrosion was found at 583 spots just in sections of the pipeline in Kaufman County, Edward Ziegler, a safety consultant hired by Danny Smalley's attorneys, testified. ‘In the industry, that would be called Swiss cheese, which means essentially the pipeline is gone," Ziegler told the jury in the case. The newspaper said Koch replaced or repaired sections where 30 percent or more of the pipe's wall had rusted away, but not spots with lighter corrosion, including the area near Smalley's home.” [Topeka Capital Journal, 7/24/01]

Jury Awarded $296 Million In Damages, A $3.5 Million Punitive Damages Settlement Was Reached A Jury Awarded $296 Million In Actual Damages After The Koch Industries 1996 Pipeline Explosion. According to The Dallas Morning News, “A jury awarded $ 296 million in actual damages Friday in a wrongful-death lawsuit filed against Koch Industries from a 1996 pipeline blast that killed two Kaufman County teens. Jason Stone and Danielle Smalley, both 17, died in the Aug. 24, 1996, explosion near Lively, about 45 miles southeast of Dallas.” [The Dallas Morning News, 10/23/99] x A $3.5 Million Punitive Damages Settlement Was Reached On Top Of The $296 Million Jury Award. According

to The Associated Press State & Local Wire “Weekend negotiations led to a $ 3.5 million punitive damage settlement, on top of a $ 296 million jury award for actual damages, in a wrongful death lawsuit filed against Koch Industries in connection with a deadly pipeline blast. Relatives of 17-year-old Danielle Smalley, one of two teens killed in the 1996 explosion near Lively, about 45 miles southeast of Dallas, and Koch Industries reached the settlement over the weekend. State District Judge Glen Ashworth approved it Monday.” [The Associated Press State & Local Wire, 10/25/99]

x After Being Ordered To Pay The Smalley Family $296 Million, Koch Industries Later Settled With The Family

For An Undisclosed Sum. According to Salon.com, “On Aug. 24, 1996, near Lively, Texas, Danielle Smalley and her friend Jason Stone were burned to death after a decrepit Koch pipeline exploded after the teens started the ignition of their truck. The feds documented ‘severe corrosion’ and ‘mechanical damage’ in the pipeline. Koch Pipeline Company LP failed to ‘adequately protect its pipeline from corrosion,’ a National Transportation Safety Board report would state. After a lengthy trial, Koch Industries was ordered to pay the Smalley family $296 million, then the largest wrongful-death judgment in American legal history. The family would later settle with Koch for an undisclosed sum.” [Salon.com, 10/1/14]

Multiple People Have Died At Georgia Pacific Facilities 2012: Industrial Contractor Was Killed In An Accident At Georgia Pacific’s Muskogee, Oklahoma Plant In November 2012, An Industrial Contractors Of Oklahoma Employee Was Killed In An Accident At Georgia Pacific’s Muskogee Plant. According to The Associated Press State & Local Wire, “Federal officials are investigating after a worker was killed in an accident at the Georgia-Pacific plant in Muskogee. Officials say emergency responders were called to the mill shortly before 11 a.m. Wednesday. The Muskogee Phoenix reports ( http://is.gd/7OVIkP) that the man was working for Industrial Contractors of Oklahoma, which is an electrical contractor. ICO’s owner, Mike Huckaby, declined to release the worker’s name. He says the company is working with officials to figure out what happened.” [The Associated Press State & Local Wire, 11/8/12]

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2007: Subcontracted Cleaning Employee Dies From Injuries In 2007, An Employee Died Of Injuries He Sustained During An Accident At Georgia Pacific’s Cedar Springs Facility. According to The Dothan Eagle, “A Jacksonville, Fla. man has died of injuries he sustained in an accident at the Georgia-Pacific plant. Ernest Robertson, 51, died at about 8 p.m. Monday at Southeast Alabama Medical Center.” [The Dothan Eagle, 6/20/07] x The Employee Was A Cleaning Subcontractor Working At The Georgia Pacific Plant. According to The Dothan

Eagle, “Houston County Coroner Robert Byrd said Robertson was a cleaning subcontractor working at the plant. At about 3 p.m. Monday, Robertson fell either onto or in front of a high-pressure cleaning device, Byrd said. Celia Bostwick, a spokesperson for Georgia-Pacific, said Robertson had been using a high-pressure hose to clean a clogged drain during a maintenance outage at the plant.” [The Dothan Eagle, 7/20/07]

x Georgia Pacific Was Fined $63,000 For The Employees Death. According to The Dothan Eagle, “In both instances,

OSHA found fault with the plant’s safety precautions and fined Georgia-Pacific. The company was fined $102,000 in the Kincey fatality and $63,000 in the Widner death.” [The Dothan Eagle, 7/20/07]

The Cedar Springs Facility Had Three Fatalities In Five Years. According to The Dothan Eagle, “Robertson’s death is the third fatality at the Cedar Springs facility in the last five years.” [The Dothan Eagle, 7/20/07] 2006: Jerry Leslie Widner Died From Head Injuries After Falling 30 Feet In 2006, Jerry Leslie Widner Died From Head Injuries After Falling 30 Feet At The Facility. According to The Dothan Eagle, “In 2006, Jerry Leslie Widner died from head injuries sustained after falling 30 feet when a vacuum pressure relief device discharged steam and paper stock, blowing him into a catwalk guardrail that gave way.” [The Dothan Eagle, 7/20/07] 2003: Georgia Pacific Employee Died After Falling Into A Paper Machine In 2003, An Employee Died After Falling Into A Paper Machine. According to The Dothan Eagle, “Walter Kincey died in a 2003 accident at the plant. Kincey fell into the pulper of a paper machine while clearing paper from an operating conveyor.” [The Dothan Eagle, 7/20/07] Georgia Pacific Was Found At Fault In Deaths And Was Forced To Pay Fines Georgia Pacific Was Fined $102,000 For The Employees Death At The Kincey Facility And $63,000 For The Widner Death At The Cedar Springs Facility. According to The Dothan Eagle, “In both instances, OSHA found fault with the plant’s safety precautions and fined Georgia-Pacific. The company was fined $102,000 in the Kincey fatality and $63,000 in the Widner death.” [The Dothan Eagle, 7/20/07] In The 2003 And 2006, The Occupational Safety And Health Administration (OSHA) Found Fault With Georgia Pacific’s Safety Precautions. According to The Dothan Eagle, “In 2006, Jerry Leslie Widner died from head injuries sustained after falling 30 feet when a vacuum pressure relief device discharged steam and paper stock, blowing him into a catwalk guardrail that gave way. Walter Kincey died in a 2003 accident at the plant. Kincey fell into the pulper of a paper machine while clearing paper from an operating conveyor. In both instances, OSHA found fault with the plant’s safety precautions and fined Georgia-Pacific. The company was fined $102,000 in the Kincey fatality and $63,000 in the Widner death. In both instances, OSHA found fault with the plant’s safety precautions and fined Georgia-Pacific. The company was fined $102,000 in the Kincey fatality and $63,000 in the Widner death.” [The Dothan Eagle, 7/20/07] 2002: Contractor Hired To Work On A Georgia-Pacific Building Died After Falling Through The Roof. In April Of 2002, A Contractor Hired To Work On A Georgia Pacific Building In Georgia Died After Falling Through The Roof. According to The Dothan Eagle, “A wrongful death suit resulting from a fall through the roof of a building at Georgia Pacific has settled out of court. The suit stemmed from an incident that occurred April 18, 2002, when Scott White of Columbia was working for a contractor hired to remove and replace a portion of the roof on an old building at

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Georgia Pacific in Cedar Springs, Ga. White was working on the roof when he fell through a piece of tin and was killed.” [The Dothan Eagle, 1/17/08] Georgia Pacific Settled The Resulting Lawsuit Out Of Court Georgia Pacific Subsequently Settled The Resulting Lawsuit Out Of Court. According to The Dothan Eagle, “A wrongful death suit resulting from a fall through the roof of a building at Georgia Pacific has settled out of court.” [The Dothan Eagle, 1/17/08] 1997: An Explosion At Georgia Pacific’s Watkins Road Plant Killed One Employee And Injured Thirteen Others In September 1997, An Explosion Occurred At Georgia Pacific’s Watkins Road Plant. According to Class Action Reporter, “The settlement called for Georgia-Pacific to compensate as many as 6,000 people who suffered health problems or property damage resulting from the September 10, 1997, explosion of an 8,500-gallon resin kettle at the company’s Watkins Road plant.” [Class Action Reporter, 11/20/07] The Explosion Killed One Employee And Injured 13 Others. According to Class Action Reporter, “The blast killed one employee and injured at least 13 others.” [Class Action Reporter, 11/20/07] Georgia Pacific Was Sued By The South Side Community Action Association In 1998 Georgia Pacific Was Sued By The South Side Community Action Association In 1998. According to Class Action Reporter, “Attorneys for the South Side Community Action Association, which had sued Georgia-Pacific in 1998, announced the $22 million settlement last October.” [Class Action Reporter, 11/20/07] Georgia Pacific Settled The Case For $22 Million In 2006, Compensating As Many As 6,000 People Who Suffered Health Problems Or Property Damage As A Result Of The Explosion Georgia Pacific Settled The Case For $22 Million In 2006. According to Class Action Reporter, “Attorneys for the South Side Community Action Association, which had sued Georgia-Pacific in 1998, announced the $22 million settlement last October. And Franklin County Common Pleas Judge Jennifer Brunner approved the agreement on December 19.” [Class Action Reporter, 11/20/07] The Settlement Called For Georgia-Pacific To Compensate As Many As 6,000 People Who Suffered Health Problems Or Property Damage Resulting From The Explosion. According to Class Action Reporter, “The settlement called for Georgia-Pacific to compensate as many as 6,000 people who suffered health problems or property damage resulting from the September 10, 1997, explosion of an 8,500-gallon resin kettle at the company’s Watkins Road plant.” [Class Action Reporter, 11/20/07] MANY SEVERE INJURIES HAVE BEEN REPORTED AT KOCH FACILITIES Worker Burnt At Invista Facility 2009: Wilimington, NC, Worker Received First- And Second-Degree Burns To 60 Percent Of His Body Worker Was Burned On Approximately 60 Percent Of His Body And Was Hospitalized. According to OSHA, “On June 27, 2009, a worker was performing a start-up operation on a system that had been down for several weeks. During the start-up, hot dimethyl terephthalate (DMT) came in contact with cold water that was in the line, creating pressure which was released through the relief valve in the form of a vapor. The worker received first- and second-degree burns to approximately 60 percent of his body and was hospitalized.” [OSHA, 6/27/09]

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Crane Worker’s Right Arm Burned While Working On Invista Boiler 2013: Crane Worker’s Right Arm Burned By Hot Water When Working On An Invista Boiler Pipe Tranquilino Rios Garcia III Had His Right Arm Burned By Hot Water And/Or Steam When An Invista Employee Turned On An Invista Boiler Pipe He Was Working On; Garcia Sued Invista For $1 Million In Damages. According to the Victoria Advocate, “In a separate lawsuit, Tranquilino Rios Garcia III, of Mission, is seeking $1 million in damages. Employed by Hidalgo Power Inc., or Plant N. Power, as a crane rigger, Garcia claims that Dec. 19, his right arm was burned by hot water and/or steam when an Invista employee turned on a pipe for a boiler he was working on. OSHA does not have a record of the incident, Rodriguez wrote.” [Victoria Advocate, 7/12/14] 2014: Invista And Garcia Settled Out Of Court. According to the case of Garcia v. Invista, S.a.r.l. LLC, the case was dismissed and Invista settled out of court with Garcia. [Garcia v. INVISTA, S.a.r.l LLC, 6:2014cv00041] Workers Injured By Explosion And Chemical Exposure At Koch Nitrogen Plants Two Koch Nitrogen Workers Injured By Explosion At Plant Two Workers Were Injured After An Explosion At A Koch Nitrogen Plant In Nebraska. According to Beatrice Daily Sun, “Two workers at Koch Nitrogen were transported for injuries following an early morning explosion at the plant. Beatrice Fire and Rescue transported one worker with serious injuries to BryanLGH West in Lincoln, while the other sustained minor injuries in the blast and was transported by the department to Beatrice Community Hospital for treatment.” [Beatrice Daily Sun, 8/17/12] Four Workers Were Exposed To Ammonia At Koch Nitrogen Plant In Beatrice, Nebraska Workers Reported To Be In Good Condition After Being Exposed To Ammonia At Koch Nitrogen In Beatrice, Nebraska. According to Beatrice Daily Sun, “Four contract workers were reported to be in good condition after being exposed to ammonia at Koch Nitrogen in Beatrice Wednesday afternoon during routine maintenance. […] The plant is still operating normally, but the maintenance activity was stopped. Koch Nitrogen is working with contractors to investigate the incident.” [Beatrice Daily Sun, 1/11/08] Koch Membrane Systems’ Worker Lost His Right Finger After It Was Caught In Machinery Koch Membrane Systems Employee Lost His Right Index Finger After It Was Caught In Machinery In 2009, A Koch Membrane Systems Employee Lost His Right Index Finger After It Was Caught In Machinery. According to OSHA, “At approximately 6:20 p.m. on December 11, 2009, Employee #1, a maintenance craftsman, was doing his assigned job at a manufacturer of fluid filtration membranes. He was inspecting the pulley and v-belt of a system used for pumping brine solution to the O-cell test loop in the quality control process. The drive motor of the pulley system was activated during his inspection. His right index finger got caught between the pulley and the belt and was crushed at the tip. He was immediately taken to the hospital for treatment, and the right index finger was amputated at the third joint. No markings of any type could be located on the motor.” [OSHA, 9/16/10] x The Koch Membrane Systems Facility Was Fined $5,000 By The Occupational Safety & Health Administration

(OSHA) For A Violation Involving Work-Connected Fatality/Injury Reporting. According to the Occupational Safety & Health Administration, the Koch Membrane Systems facility at 10054 Old Grove Rd in San Diego, California was fined $5,000 by the Occupational Safety & Health Administration on April 19th, 2010. The fine reached an informal settlement on May 4th, 2010 for $5,000. The violation cited “342 A (18B-CA) Work-Connected Fatality/Injury Reporting.” [Occupational Safety & Health Administration, 5/4/10; California Occupational Safety and Health Regulations, Accessed 10/7/15]

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Georgia-Pacific Worker Suffered Injury After His Hand Was Caught In A Machine 2014: Eight People, Including Four Employees Were Injured Due To An Explosion At Georgia Pacific’s Corrigan, Texas Facility In April Of 2014, An Explosion At Georgia Pacific’s Corrigan, Texas Facility Caused Series But Not Life-Threatening Injuries To Four Employees. According to the Associated Press State & Local, “An explosion has rocked a plywood manufacturing plant north of Houston, injuring seven workers and causing a fire that took hours to extinguish. The explosion occurred about 6:15 p.m. Saturday at the Georgia-Pacific plant in Corrigan, Texas, a town about 90 miles north of Houston. Georgia-Pacific official Eric Abercrombie says four injured workers were flown to a Houston hospital. He says they suffered serious burns but that the injuries were not life-threatening. Three other injured employees were taken by ambulance to a hospital in nearby Lufkin. One of them has been released.” [Associated Press State & Local, 4/27/14] x Eight People Were Injured In The Incident. According to WFIN - 1330 AM, “Eight people were reported injured on

Saturday during a fiery explosion at a Georgia Pacific plywood plant. The explosion occurred at about 6:18 p.m. local time and was put out about two hours later, the Corrigan Police Department told ABC News. Of the eight injured, at least three were taken to nearby hospitals by helicopter. Police did not immediately release information regarding whether anyone was missing or what caused the explosion.” [WFIN - 1330 AM, 4/27/14]

Georgia Pacific Dixie Plant Worker Caught His Hand In A Machine And Went To Hospital For Treatment In May Of 2012, A Georgia Pacific Dixie Plant Worker Caught His Hand In A Machine, Causing An Injury. According to Morning Call, “A worker caught his hand in a machine at the Georgia-Pacific Dixie plant in Forks Township on Friday night. He was taken to the hospital for treatment. A rescue team and paramedics were dispatched at 8:50 p.m., but co-workers had freed him before the emergency workers arrived. ‘He was bleeding,’ Forks police Cpl. Jack Dressler said. ‘They were putting pressure on the wound. I didn’t see how severe it was.’” [Morning Call, 5/26/12] Flint Hills Resources’ Pipe Rupture Result In Hospitalization Of Two Men 2004: Two Men Hospitalized And 4,000 Fish Die As A Result Of Flint Hills’ Pipe Rupture Flint Hills’ Pipe Rupture In Corpus Christi Release 37,000 Of Toluene, A Highly Toxic Chemical Into A Storm Ditch That Runs Into The Harbor, Which Resulted In Two Men Being Hospitalized And Killed 4,000 Fish. According to the Corpus Christi Caller-Times, “Almost 4,000 fish were killed by a refinery spill into the Corpus Christi ship channel Tuesday, a state pollution biologist said. At 6 p.m. Tuesday, about 37,000 gallons of toluene, a highly toxic chemical used in solvents and to increase the octane in gasoline, leaked from a ruptured underground pipeline at Flint Hills' east plant terminal in the 1600 block of Nueces Bay Boulevard into a storm ditch that runs into the harbor, officials said. Two men taken to the hospital because of the incident were released Wednesday morning, according to a refinery spokesman. Flint Hills and state environmental workers said the spill did not pose a threat to anyone living near the plant. Two men who work for Corpus Christi Terminal Railroad, which manages the Port of Corpus Christi's rail system, were taken to the hospital as a result of the spill and were released Wednesday morning, Krysiak said. John Slubar, manager of operations at the Corpus Christi Terminal Railroad, would not release any information about the employees, their injuries or current conditions.” [Corpus Christi Caller-Times, 8/26/04] KOCH INDUSTRIES HAS RECEIVED AT LEAST 14 OSHA VIOLATIONS RESULTING IN $38,184 IN FINES Flint Hills Resources Paid $8,034 In Fines For Safety Violations In 2014, Flint Hills Resources’ Fairmont, NE Facility Was Fined $3,825 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving The Process Safety Management Of Highly Hazardous Chemicals. According to the Occupational Safety & Health Administration, Flint Hills Resources’ facility at 1214 Rd. G [sic] Fairmont, NE 68354 was fined $3,825 by the Occupational Safety & Health Administration on August 15th, 2014. The serious violation cited 19100119 E03 VII, “A Qualitative Evaluation of a Range of Possible Safety And Health Effects Of Failure Of Controls On Employees In The Workplace.” [Occupational Safety & Health Administration, 8/15/14, Accessed 10/27/15]

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x The Violation Was Ultimately Settled For $2,678. According to the Occupational Safety & Health Administration, the

penalty reached an informal settlement for $2,678 on September 19th, 2014. [Occupational Safety & Health Administration, 8/15/14]

In 2014, Flint Hills Resources’ Fairmont, NE Facility Was Fined $3,825 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving “Services, Feeders, And Branch Circuits.” According to the Occupational Safety & Health Administration, Flint Hills Resources’ facility at 1214 Rd. G [sic] Fairmont, NE 68354 was fined $3,825 by the Occupational Safety & Health Administration on August 15th, 2014. The serious violation cited 19100303 F02 “Services, Feeders, And Branch Circuits.” [Occupational Safety & Health Administration, 8/15/14; Accessed 10/27/15] x The Violation Was Ultimately Settled For $2,678. According to the Occupational Safety & Health Administration, the

penalty reached an informal settlement for $2,678 on September 19th, 2014. [Occupational Safety & Health Administration, 8/15/14]

In 2014, Flint Hills Resources’ Fairmont, NE Facility Was Fined $3,825 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Where “Working Space May Not Be Used For Storage.” According to the Occupational Safety & Health Administration, Flint Hills Resources’ facility at 1214 Rd. G [sic] Fairmont, NE 68354 was fined $3,825 by the Occupational Safety & Health Administration on August 15th, 2014. The serious violation cited 19100303 G01II “Working space required by this standard may not be used for storage. When normally enclosed live parts are exposed for inspection or servicing, the working space, if in a passageway or general open space, shall be suitably guarded.” [Occupational Safety & Health Administration, 8/15/14; Accessed 10/27/15] x The Violation Was Ultimately Settled For $2,678. According to the Occupational Safety & Health Administration, the

penalty reached an informal settlement for $2,678 on September 19th, 2014. [Occupational Safety & Health Administration, 8/15/14]

Georgia Pacific Paid At Least $9,000 In Fines For Safety Violations In 2011, Georgia-Pacific Gypsum’s Newington Facility Was Fined $5,000 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving The Care Of An Industrial Truck. According to the Occupational Safety & Health Administration, Georgia-Pacific Gypsum’s facility at 170 Shattuck Way Newington, NH was fined $5,000 by the Occupational Safety & Health Administration on May 23rd, 2011. The “serious” violation cited “19100178 P01 Powered industrial trucks.” According to the Occupational Safety & Health Administration’s Regulations listings, “1910.178(p)(1) If at any time a powered industrial truck is found to be in need of repair, defective, or in any way unsafe, the truck shall be taken out of service until it has been restored to safe operating condition.” [Occupational Safety & Health Administration, 5/23/11; Accessed 8/28/15] x The Violation Was Ultimately Settled For $3,750. According to the Occupational Safety & Health Administration, the

penalty reached an informal settlement for $3,750 on June 16th, 2011. [Occupational Safety & Health Administration, 5/23/11]

In 2011, Georgia-Pacific Gypsum’s Newington Facility Was Fined $7,000 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving Guarding A Machine From Hazards “Such As Those Created By Point Of Operation, Ingoing Nip Points, Rotating Parts, Flying Chips And Sparks.” According to the Occupational Safety & Health Administration, Georgia-Pacific Gypsum’s facility at 170 Shattuck Way Newington, NH was fined $7,000 by the Occupational Safety & Health Administration on May 23rd, 2011. The “serious” violation cited “19100212 A01 General requirements for all machines.” According to the Occupational Safety & Health Administration’s Regulations listings, “1910.212(a)(1) Types of guarding. One or more methods of machine guarding shall be provided to protect the operator and other employees in the machine area from hazards such as those created by point of operation, ingoing nip points, rotating parts, flying chips and sparks. Examples of guarding methods are-barrier guards, two-hand tripping devices, electronic [sic] safety devices, etc.” [Occupational Safety & Health Administration, 5/23/11; Accessed 8/28/15]

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x The Violation Was Ultimately Settled For $5,250. According to the Occupational Safety & Health Administration, the penalty reached an informal settlement for $5,250 on June 16th, 2011. [Occupational Safety & Health Administration, 5/23/11]

In 2011, Georgia-Pacific Gypsum’s Newington Facility Was Fined $5,000 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving The Inspection Of Industrial Trucks. According to the Occupational Safety & Health Administration, Georgia-Pacific Gypsum’s facility at 170 Shattuck Way Newington, NH was fined $5,000 by the Occupational Safety & Health Administration on May 23rd, 2011. The “serious” violation cited “19100178 Q07 Powered industrial trucks.” According to the Occupational Safety & Health Administration’s Regulations listings, “1910.178(q)(7) Industrial trucks shall be examined before being placed in service, and shall not be placed in service if the examination shows any condition adversely affecting the safety of the vehicle. Such examination shall be made at least daily. Where industrial trucks are used on a round-the-clock basis, they shall be examined after each shift. Defects when found shall be immediately reported and corrected.” [Occupational Safety & Health Administration, 5/23/11; Accessed 8/28/15] x The Violation Was Settled On June 16th, 2011 For An Unknown Amount. According to the Occupational Safety &

Health Administration, the penalty reached an informal settlement for an unknown amount on June 16th, 2011. [Occupational Safety & Health Administration, 5/23/11]

Koch Membrane Systems Paid $1,200 In Fines For Safety Violations The Koch Membrane Systems Facility Was Fined $750 By The Occupational Safety & Health Administration (OSHA) For A Violation Involving Servicing Moving Machinery/Equipment. According to the Occupational Safety & Health Administration, the Koch Membrane Systems facility at 10054 Old Grove Rd in San Diego, California was fined $750 by the Occupational Safety & Health Administration on April 14th, 2010. The violation cited “3314 H01 (18B-CA) Servicing Moving Machinery/Equipment.” [Occupational Safety & Health Administration, 5/4/10] x The Fine Was Informally Settled On May 4th, 2010 For $600. According to the Occupational Safety & Health

Administration, the penalty reached an informal settlement for $600 on May 4th 2010. [Occupational Safety & Health Administration, 5/4/10]

The Koch Membrane Systems Facility Was Fined $18,000 By The Occupational Safety & Health Administration (OSHA) For A Serious Violation Involving Servicing Moving Machinery/Equipment. According to the Occupational Safety & Health Administration, the Koch Membrane Systems facility at 10054 Old Grove Rd in San Diego, California was fined $18,000 by the Occupational Safety & Health Administration on April 14th, 2010. The violation cited “3314 G02 A (18B-CA) Servicving [sic] Moving Machinery/Equipment.” [Occupational Safety & Health Administration, 5/4/10] x The Fine Was Informally Settled On May 4th, 2010 For $600. According to the Occupational Safety & Health

Administration, the penalty reached an informal settlement for $600 on May 4th, 2010. [Occupational Safety & Health Administration, 5/4/10]

Koch Nitrogen Paid $19,950 In Fines For Safety Violations A Koch Nitrogen Facility In Dodge City, Kansas, Was Assessed $21,000 In Fines For Three Serious Violations By The Occupational Safety & Health Administration (OSHA). According to OSHA, Koch Nitrogen’s plant at 11559 U.S. Highway Dodge City, KS was fined $21,000 by OSHA for three serious violations on July 30, 2013. [Occupational Safety & Health Administration, accessed 10/27/15] x Dodge City Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Maintenance, Safeguards, And

Operational Features For Exit Routes” With A $7,000 Penalty. According to OSHA, the Dodge City Koch Nitrogen plant had a serious violation of standard 19100037-B01, which involves “Maintenance, Safeguards, And Operational Features For Exit Routes.” The violation was considered serious and included a $7,000 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

x Dodge City Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Process Safety Management

Of Highly Hazardous Chemicals” With A $7,000 Penalty. According to OSHA, the Dodge City Koch Nitrogen plant

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had a serious violation of standard 19100119-E03-VII, which involves “Process Safety Management Of Highly Hazardous Chemicals.” The violation was considered serious and included a $7,000 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

x Dodge City Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Process Safety Management

Of Highly Hazardous Chemicals” With A $7,000 Penalty. According to OSHA, the Dodge City Koch Nitrogen plant had a serious violation of standard 19100119-H02-II, which involves “Process Safety Management Of Highly Hazardous Chemicals.” The violation was considered serious and included a $7,000 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

Koch Nitrogen And OSHA Reached A Settlement And Koch Nitrogen Was Assessed One “Other” Violation Of “Process Safety Management Of Highly Hazardous Chemicals” For $7,000. According to OSHA, Koch Nitrogen and OSHA reached an informal settlement where two violations were dropped (19100119-E03-VII and 19100119-H02-II) and the violation concerning “Process Safety Management Of Highly Hazardous Chemicals.” was changed from “Serious” to “Other.” [Occupational Safety & Health Administration, accessed 10/27/15] A Koch Nitrogen Facility In Beatrice, Nebraska, Was Assessed $12,950 In Fines For Four Serious Violations By OSHA. According to OSHA, Koch Nitrogen’s plant at 21178 SW 89th Road Beatrice, NE was fined $12,950 for four serious violations on June 24, 2010. [Occupational Safety & Health Administration, accessed 10/27/15] x Beatrice Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Process Safety Management Of

Highly Hazardous Chemicals” With A $2,125 Penalty. According to OSHA, the Beatrice Koch Nitrogen Plant had a serious violation of standard 19100119-D03-1Fm which involves “Process Safety Management of Highly Hazardous Chemicals.” The violation was considered serious and included a $2,125 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

x Beatrice Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Process Safety Management Of

Highly Dangerous Chemicals” With A $2,125 Penalty. According to OSHA, the Beatrice Koch Nitrogen Plant had a serious violation of standard 19100119-E03-I, which involves “Process Safety Management of Highly Hazardous Chemicals.” The violation was considered serious and included a $2,125 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

x Beatrice Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Process Safety Management Of

Highly Dangerous Chemicals” With A $7,000 Penalty. According to OSHA, the Beatrice Koch Nitrogen Plant violated standard 19199119-F04, which involved “Process Safety Management of Highly Hazardous Chemicals.” The violation was considered serious and included a $7,000 fine. [Occupational Safety & Health Administration, accessed 10/27/15]

x Beatrice Koch Nitrogen Facility Was Assessed A Serious Violation Involving “Specifications For Accident

Prevention Signs And Tags” With A $1,700 Penalty. According to OSHA, the Beatrice Koch Nitrogen Plant violated standard 19199145-C02-I, which involved “Specifications For Accident Prevention Signs And Tags.” The violation was considered serious and included a $1,700 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

Koch Nitrogen And OSHA Reached A Settlement And Koch Nitrogen Was Assessed Four Violations And A Penalty Of $12,950. According to OSHA, Koch Nitrogen and OSHA reached an informal settlement. The Beatrice Koch Nitrogen Plant was assessed four serious violations and a $12,950 penalty. [Occupational Safety & Health Administration, accessed 10/27/15]

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KOCH INDUSTRIES ACCUSED OF OIL THEFT FROM INDIAN RESERVATIONS AND OTHERS Koch Industries Was Investigated By The US Senate And The Justice Department For Stealing Oil Koch Was Accused Of Using Fraudulent Measurement Practices To Steal Oil From Producers In Several States And Indian Reservations. According to Tulsa World “Koch is accused of using fraudulent measurement practices to steal oil from producers in several states, including Utah. Koch Oil Co. allegedly underreported the amount of oil it purchased from Indian and federal leases in 13 states throughout the 1980s. […] The plaintiffs claim in a lawsuit that the company adjusted measurements in ways that allowed it to collect more oil than it paid for. The adjustments were made regardless of field conditions, plaintiffs contend.” [Tulsa World, 11/18/99] x Koch Industries Allegedly Made $230 Million From Free Oil In 13 States From 1985 Until 1989. According to the

Associated Press, “The alleged scheme of adjusting measurements has been referred to as the ‘Koch method’ by former employees. The lawsuit claims Koch received $230 million in free oil in 13 states from 1985 until 1989.” [Associated Press, 11/9/99]

x Koch Industries Claimed Defendants Knew About The Adjustments. According to Tulsa World, “The plaintiffs

argue that Koch planned to cheat producers by adjusting measurements in the company's favor when it purchased oil. Koch claims producers knew about the adjustments to make up for field conditions like oil shrinkage or tanks encrusted with sediment.” [Tulsa World, 11/17/99]

Charles Koch Admitted Under Oath That The Company Was Taking More Than $10 Million A Year In Oil It Didn’t Pay For. According to Indian Country Today, “Koch Oil CEO and Chairman of the Board Charles Koch, while admitting under oath in testimony before committee investigators that the company was taking more than $10 million a year in oil it did not pay for, said ‘[Oil measurement] is a very uncertain art … And you have people [measuring] who aren’t rocket scientists … [No] one can ever make an exact measurement … There is a lot of uncertainty … and you [have] got tremendous variations.’” [Indian Country Today, 10/28/14] Oil Gaugers Told Investigators That They Were “Explicitly Trained In The ‘Koch Method’ Of Measurement And Reporting” Which Included “Volume Enhancement.” According to Indian Country Today, “In interviews, the gaugers told investigators they “were specifically instructed to engage in ‘volume enhancement,’ bumping the temperature about 10 degrees, taking anywhere from one to four inches of oil off the gauge, and increasing the sediment and water.” Interviewees told investigators that gaugers were explicitly trained in the ‘Koch method’ of measurement and reporting.” [Indian Country Today, 10/28/14] 1989: Senate Hearings Into Koch Industries’ Theft Of Oil From Indian Reservations In May Of 1989, The Senate Held Hearings Into Koch Industries’ Theft Of Oil On American Indian Reservations Which Cheated The Federal Government Out Of Royalties. According to Bloomberg Business, “The Senate held hearings in May 1989 after Bill Koch, David Koch’s twin brother, told a U.S. Senate special committee on investigations that Koch Industries was stealing oil on American Indian reservations, cheating the federal government of royalties.” [Bloomberg Business, 10/3/11] Senate Investigators Found Koch Industries’ Theft Was “Widespread And Pervasive” Senate Investigators Found That Theft Was “Widespread And Pervasive, And These People Are Being Horribly Victimized.” According to Bloomberg Business, “The Senate committee sent investigators to Oklahoma to secretly observe oil companies, including Koch, buying crude on Indian land. The federal agents hid in ditches, crouched behind scrub cedars and ducked behind cows to avoid detection by Koch Oil’s purchasers, FBI agent Richard Elroy testified to the committee in May 1989. ‘Theft is Widespread’ […] ‘The theft is widespread and pervasive, and these people are being horribly victimized,’ Elroy testified.” [Bloomberg Business, 10/3/11] Koch Industries Reported $24 Million A Year In Overages Until It Recorded Its First Shortage The Same Year That The Committee Investigation Began. According to NewsOk, “Koch reported up to $24 million a year in overages from the

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1950s until the late 1980s when it recorded its first shortage - the same year a U.S. Senate subcommittee began investigating the company’s measurement policies, the plaintiffs showed.” [NewsOK, 12/24/99] “Koch Oil, The Largest Purchaser Of Indian Oil In The Country, Was Engaged In A Widespread And Sophisticated Scheme To Steal Crude Oil From Indians And Others Through Fraudulent Mismeasuring And Misreporting.” According to Indian Country Today, “An investigation begun in 1988 by a select committee of the Senate Committee on Indian Affairs comprised of Sens. John McCain (R-Ariz.), Dennis DeConcini (D-Ariz.) and Tom Daschle (D-S.D.) found that Koch Oil had cheated American Indian tribes out of millions of dollars in royalties by intentionally and consistently lying about how much crude they had taken out of storage tanks on Indian lands. The committee issued its report (Senate Report 101-216) in 1989: ‘Koch Oil, the largest purchaser of Indian oil in the country, was engaged in a widespread and sophisticated scheme to steal crude oil from Indians and others through fraudulent mismeasuring and misreporting.’” [Indian Country Today, 10/28/14] “Koch’s Records Showed That The Company Took 1.95 Million Barrels Of Oil It Didn’t Pay For From 1986 To 1988.” According to Bloomberg Business, “The investigators caught Koch Oil’s employees falsifying records so that the company would get more crude than it paid for, shortchanging Indian families, Elroy said. Koch’s records showed that the company took 1.95 million barrels of oil it didn’t pay for from 1986 to 1988, according to data compiled by the Senate.” [Bloomberg Business, 10/3/11] 1989: The Senate Referred The Case To The Justice Department “The Senate Referred The Case To The Justice Department, Which Convened A Grand Jury That Never Indicted The Company.” According to Bloomberg Business, “The committee concluded in a November 1989 report that Koch Oil had engaged in a widespread, sophisticated scheme to steal millions of barrels of oil. The Senate referred the case to the Justice Department, which convened a grand jury that never indicted the company.” [Bloomberg Business, 10/3/11] U.S. District Court Held That It Was Not The Plaintiffs’ Burden To Demonstrate That The Defendants [Koch Industries] “Stole” Oil, And The Court Was Persuaded That Plaintiffs Should Be Allowed To Present Evidence Of A Routine Practice Of “Adjustments.” According to the case of U.S. vs. Koch Industries, “As demonstrated elsewhere in this Order, specific intent to defraud is not an element of plaintiffs' claim. It is not plaintiffs' burden to demonstrate that defendants ‘stole’ oil. The Court is persuaded from the record that plaintiffs should be allowed to present evidence of a routine practice of ‘adjustments’ to observed measurements on defendants' part.” [United States Of America, ex rel., William I. Koch and William A. Presley, Plaintiffs, vs. Koch Industries, Inc, et al., Defendants, No. 91-CV-763-K] The Court Was Not Persuaded By The Argument That If A Legitimate Field Condition Justified The Adjustment That The Adjusted Measurement Was “True” As This Would Result In The Submission Of “Adjusted” Records Without Informing The Government Of The Adjustment. According to the case of U.S. vs. Koch Industries, “The Court is not persuaded by the argument that if a legitimate field condition justifies the adjustment, the run ticket is metaphysically ‘true’. Adopting this result would authorize the submission of ‘adjusted’ records without informing the government of the adjustment.” [United States Of America, ex rel., William I. Koch and William A. Presley, Plaintiffs, vs. Koch Industries, Inc, et al., Defendants, No. 91-CV-763-K] KOCH INDUSTRIES ENGAGED IN OTHER POTENTIALLY ILLEGAL ACTIVITY INCLUDING DOING BUSINESS WITH IRAN AND AVOIDING TAXES Koch Industries Did Business With Iran Despite Ban Bloomberg Investigation Found Koch Subsidiary, Koch-Glitsch (Germany) Sold Millions Worth Of Chemical Equipment To Iran. According to Targeted News Service, “Bloomberg Investigation Found Koch Industries Has Sold Millions Worth of Chemical Equipment to Iran, Thwarting a U.S. Trade Ban. A Bloomberg Markets investigation has found that Koch Industries has sold millions of dollars of petrochemical equipment to Iran, a country the U.S. identifies as a sponsor of global terrorism. Internal company documents show that the company made those sales through foreign subsidiaries, thwarting a U.S. trade ban. A Koch Industries, foreign subsidiary, Koch-Glitsch in Germany and Italy continued selling to Iran until as recently as 2007, the records show.” [Targeted News Service, 6/20/12]

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x U.S. Companies Have Been Banned From Trading With Iran Since 1995. According to the Washington Post, “U.S. companies have been banned from trading with Iran since 1995, when President Bill Clinton declared it a threat to national security. Iran supports Iraqi militants and Taliban fighters as well as terrorist groups, including Hamas and Hezbollah, according to the State Department.” [Washington Post, 10/8/11]

The U.S. Government Investigated Koch-Glitsch For Sales To Iran. According to Targeted News Service, “U.S. Government Has Investigated Koch Subsidiary For Sales to Iran. According to the Bloomberg report, the U.S. government has investigated Koch's European unit for its sales to Iran. On Aug. 14, 2008, investigators from the U.S. Department of Homeland Security met with Josh Bentu, who had worked as a sales engineer from 2001 to 2007 for Koch-Glitsch in Germany, Bentu says. In a four-hour interview at the U.S. consulate in Frankfurt, the officials asked about documents showing details of the company's trades with Iran, he says.” [Targeted News Service, 6/20/12] Koch Glitsch Products Helped Build A Methanol Plant For Iran’s State-Owned National Iranian Petrochemical. According to the Washington Post, “The company's products helped build a methanol plant for Zagros Petrochemical, a unit of Iran's state-owned National Iranian Petrochemical, the documents show. The facility, in the coastal city of Bandar Assaluyeh, is the largest methanol plant in the world, according to IHS, a provider of chemical, energy and economic data.” [Washington Post, 10/8/11] After George W. Bush Described Iran As Part Of The “Axis Of Evil” Koch Glitsch Was Sent An Order By Iran In 2003 And 2004. According to the Washington Post, “ In his State of the Union address on Jan. 29, 2002, President George W. Bush described Iran as part of the ‘Axis of Evil.’ A year later, Bush said, ‘In Iran, we continue to see a government that represses its people, pursues weapons of mass destruction and supports terror.’ The next day, Koch-Glitsch was sent a purchase order to supply petrochemical equipment for the Zagros plant, being designed and built by two engineering firms, Pidec in Iran and Lurgi in Germany. On May 31, 2004, Koch-Glitsch secured another contract for 1.2 million euros, to help expand the Zagros facility. The plant helped Iran turn its vast natural gas reserves into methanol, which is used for making plastics, paints and chemicals.” [Washington Post, 10/8/11] Koch Glitsch Sought Other Projects With Iran. According to the Washington Post, “The Italian office of Koch-Glitsch sought work on other projects in Iran - the expansion of the Abadan refinery, the country's largest, and the development of South Pars, part of the world's largest natural gas field, the documents show.” [Washington Post, 10/8/11] Koch Glitsch Continued Selling To Iran As Recently As 2007. According to Topeka Capital Journal, “Internal company records show that Koch Industries used its foreign subsidiary to sidestep a U.S. trade ban barring American companies from selling materials to Iran. Koch-Glitsch offices in Germany and Italy continued selling to Iran until as recently as 2007, the records show.” [Topeka Capital Journal, 10/4/11] Koch Glitsch Attempted To Insulate American Employees Of Koch Industries From Dealings With Iran Koch Industries “Took Elaborate Steps To Ensure That Its U.S. Based Employees Weren’t Involved In The Sales To Iran.” According to the Washington Post, “Koch Industries took elaborate steps to ensure that its U.S.-based employees weren't involved in the sales to Iran, internal documents show. Koch Industries may not have violated the law if no U.S. people or company divisions facilitated trades with Iran, says Avi Jorisch, a Treasury Department policy adviser from 2005 to 2008. That's impossible to determine without a complete investigation, Jorisch says.” [Washington Post, 10/8/11] x Koch Glitsch Coordinated With Koch Industries To Make Sure That American Employees Didn’t Work On

Sales To Iran. According to the Washington Post, “Internal Koch-Glitsch correspondence shows that the company coordinated with Koch Industries lawyers in the United States to make sure that American employees didn't work on sales to Iran. Elena Rigon, now Koch-Glitsch compliance manager for Europe, based in Italy, in December 2000 addressed a memo outlining compliance guidelines to company managers. In another e-mail, Rigon said offices had to go through a checklist for each estimate for materials headed to Iran.” [Washington Post, 10/8/11]

Koch Industries Director Of Corporate Communications Melissa Cohlmia: “Koch-Glitsch Had Protocols In Place That Were Consistent With Applicable U.S. Laws.” According to the Washington Post, “‘Koch-Glitsch had protocols in place that were consistent with applicable U.S. laws allowing such sales at the foreign subsidiary level,’ Koch's Cohlmia says.” [Washington Post, 10/8/11]

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Koch Glitsch Made Illegal Payoffs May 2008: Koch Industries Sent Compliance Officer Ludmila Egorova-FarinesTo Investigate Koch Glitsch’s Office In France. According to the Washington Post, “In May 2008, a unit of Koch Industries, one of the world's largest privately held companies, sent Ludmila Egorova-Farines, its newly hired compliance officer and ethics manager, to investigate the management of a subsidiary in Arles in southern France. In less than a week, she discovered that the company had paid bribes to win contracts. […] She notified her supervisors in the United States. A week later, Wichita, Kan.-based Koch Industries dispatched an investigative team to look into her findings.” [Washington Post, 10/8/11] x Farines Was Originally Asked To Investigate Koch Glitsch For Awarding Inappropriate Salary Increases.

According to the Washington Post, “The company then asked her to investigate Koch-Glitsch in France because it had heard that managers were awarding salary increases inappropriately, Egorova-Farines says. The company never mentioned anything about improper payments for contracts, she says.” [Washington Post, 10/8/11]

x Egorova-Farines Was Removed From The Inquiry In August 2008 And Was Fired In June 2009 Despite

Investigators Substantiating Her Findings. According to Washington Post, “Egorova-Farines's superiors removed her from the inquiry in August 2008 and fired her in June 2009, calling her incompetent, even after Koch's investigators substantiated her findings. She sued Koch-Glitsch for wrongful termination. […] Neither Egorova-Farines nor the labor court knew at the time that Koch had cited the company's six-year pattern of improper payments in its termination letter to Mausen, she says. The court ruled against her Feb. 11. She filed an appeal. She said in court that Koch had harassed her and retaliated against her for uncovering the payment scheme. She asked to be reinstated in her Koch job and paid for the time she was out of work. Egorova-Farines now runs a business-practices consulting firm in Paris.” [Washington Post, 10/8/11]

September 2008: Researches Found Evidence Of Improper Payments To Secure Contracts In Six Countries Authorized By Koch Glitsch. According to Washington Post, “By that September, the researchers had found evidence of improper payments to secure contracts in six countries dating to 2002, authorized by the company's Koch-Glitsch affiliate in France.” [Washington Post, 10/8/11] Koch Industries Was Involved In Improper Payments In Africa, India And The Middle East And Sold Millions Of Dollars In Petrochemical Equipment To Iran Through Subsidiaries. According to Washington Post, “A Bloomberg Markets investigation has found that Koch Industries - in addition to being involved in improper payments to win business in Africa, India and the Middle East - has sold millions of dollars of petrochemical equipment to Iran, a country the United States identifies as a sponsor of global terrorism. Internal company documents show that the company made those sales through foreign subsidiaries, thwarting a U.S. trade ban. Koch Industries units have also rigged prices with competitors, lied to regulators and repeatedly run afoul of environmental regulations, resulting in five criminal convictions since 1999 in the United States and Canada.” [Washington Post, 10/8/11] Koch Glitsch Made Illicit Payments From 2002 – 2008 In Algeria, Egypt, India, Morocco, Nigeria, And Saudi Arabia. According to the Washington Post, “Koch-Glitsch fired Mausen on Dec. 8, 2008, sending him a letter that described illicit payments from 2002 to 2008 in Algeria, Egypt, India, Morocco, Nigeria and Saudi Arabia. In the Middle East, Koch-Glitsch paid what the letter describes as an exceptionally high commission of 23 percent to one of its sales agents. […] ‘A portion of that money was intended to pay a customer's employee in order to secure the con-tract’ Koch wrote. The customer was an unnamed Egyptian company that was partially owned by the state. Koch-Glitsch made similar payments to win other contracts with public and private companies in Egypt and Saudi Arabia, Koch wrote in its letter to Mausen. Koch-Glitsch gave envelopes stuffed with cash to a Moroccan company, Koch wrote in its letter. Koch-Glitsch also made an payment to secure a contract with a Moroccan government organization, Koch wrote. The company made similar payments to a Nigerian government agency to win contracts, Koch wrote.” [Washington Post, 10/8/11] x Koch Glitsch Gave, “Envelopes Stuffed With Cash” To A Moroccan Company And A Nigerian Government

Agency To Secure Contracts. According to the Washington Post, “Koch-Glitsch gave envelopes stuffed with cash to a Moroccan company, Koch wrote in its letter. Koch-Glitsch also made an [sic] payment to secure a contract with a Moroccan government organization, Koch wrote. The company made similar payments to a Nigerian government agency to win contracts, Koch wrote.” [Washington Post, 10/8/11]

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x Koch Gltisch Inflated Its Bid Price In India To “Add An Extra 2 Percent For A Third Person Whose Name I

Would Rather Give You Only On The Phone.” According to the Washington Post, “Koch-Glitsch inflated its bid price to a private company in India in 2008, the letter said. A Koch employee explained why in an e-mail copied to Mausen dated Feb. 6, 2008: ‘Add an extra 2 percent for a third person whose name I would rather give you only on the phone at this time.’” [Washington Post, 10/8/11]

x Koch Glitsch Increased The Commission To An Algerian Agent To Cover An Unlawful Payment Used To

Secure A Deal With An Unnamed French Company. According to the Washington Post, “A Koch-Glitsch agent increased the commission paid to an Algerian agent in 2007 and 2008 to cover what Koch described as an unlawful payment to secure a deal with an unnamed French company.” [Washington Post, 10/8/11]

Trial Revealed Koch Glitsch Approved Illegal Dealings Koch Industries Blamed Koch-Glitsch (France) Business Director Leon Mausen For The Illegal Payments And Fired Him In 2008. According to the Washington Post, “In its Dec. 8, 2008, termination letter to Mausen, Koch blamed him for the illegal payments. In July 2009, Mausen sued Koch for severance and performance pay in the Arles Labor Court in France.” [Washington Post, 10/8/11] A French Court Ruled That Mausen Did Not Act On His Own And His Actions Required Company Approval. According to the Washington Post, “On Sept. 27, 2010, the court said Mausen hadn't acted on his own. ‘It was not Mr. Mausen alone who was giving authorizations,’ the court wrote. Company policy required approval from other Koch-Glitsch managers, including Christoph Ender, the president of Koch-Glitsch for Europe and Asia. ‘Ender, manager of Koch-Glitsch France, as well as the controllers and auditors who were assisting him, allowed such business practices developed with Mr. Mausen to continue without doing due diligence in their reviews concerning the payment of commissions and the final beneficiaries of said commissions,’ the labor court wrote.” [Washington Post, 10/8/11] x A French Appeals Court Upheld The Ruling That Mausen Did Not Act Alone. According to the Washington Post,

“An appeals court in Aix-en-Provence issued a second ruling on June 14, saying the company couldn't justify terminating Mausen for the payment scheme, because his managers had been aware of the practices for more than 60 days before he was fired. The court ordered Koch-Glitsch to pay Mausen $206,170. Mausen declined to comment, beyond saying he disputed Koch's arguments in court. Ender, who is now a Koch-Glitsch executive in Wichita, didn't respond to requests for comment.” [Washington Post, 10/8/11]

Bentu: “Every Single Chance They Had To Do Business With Iran, Or Anyone Else, They Did.” According to the Washington Post, “‘Every single chance they had to do business with Iran, or anyone else, they did,’ says Bentu, 46. Bentu, a German engineer who earned his master's degree in chemical engineering from Montana State University in Bozeman in 1990, joined Koch-Glitsch in 2001. His duties included drawing up bids for potential buyers of the company's distillation equipment, which is used in making fuels, fertilizers and detergents. Bentu says he had been working at Koch-Glitsch in Germany, for two months when he first saw an order destined for Iran. Concerned that the transaction might run afoul of U.S. law, Bentu asked his manager about it, he says. Bentu says his boss told him not to worry, that the company's U.S. lawyers made sure the deals with Iran were legal.” [Washington Post, 10/8/11] Koch Industries Used Questionable Accounting Practices Designed To Limit Koch Asphalt’s Tax Liability; IRS Required Koch To Pay Millions In Taxes It Tried To Avoid IRS Audit Resulted In Koch Industries Being Forced To Pay An Additional $20 Million After Trying To Avoid Paying High Taxes 2006: The IRS Audited Koch Industries’ Tax Returns For 1998 Through 2000 And Increased The Company’s Tax Liability By Just Over $20 Million For That Period. According to the United States District Court, District of Kansas, The IRS audited Koch Industries’ tax returns for the years 1998 through 2001 and concluded that Koch Industries improperly reported the construction agreement under IRC § 460, finding that it did not qualify as a long-term contract for accounting purposes. The IRS accordingly made adjustments to Koch Industries’ federal income tax liabilities, applying an accrual method of accounting. Koch Industries’ tax liabilities were increased by $15,529,281 for 1998, decreased by $1,485,865 for 1999,

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decreased by $4,052,415 for 2000, and increased by $10,109,888 for 2001. [Complaint, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 3/3/06] 2006: Koch Industries Brought An Action Under Internal Revenue Laws Seeking Refund Of Taxes It Agreed To Pay After The IRS Audited Koch’s Returns. According to the United States District Court, District of Kansas, On March 3, 2006, Koch Industries, Inc. and Subsidiaries filed suit in the United States District Court for the District of Kansas, seeking a refund of approximately $20 million in taxes it had paid following an IRS audit relating to a highway construction agreement between its subsidiary, Mesa PDC LLC, and the State of New Mexico. Koch Industries had accounted for the agreement as a long-term contract, while the IRS contended that the agreement constituted a warranty and required accrual accounting treatment, which would result in Koch Industries owing an additional $20 million in taxes for the years 1998 through 2001. [Complaint, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 3/3/06] x Koch Industries’ Subsidiary Contracted With The State Of New Mexico To Receive Over $46 Million For

Highway Construction And An Additional $62 Million For Warranties Covering The Highway For 20 Years After Construction Was Completed. According to the United States District Court, District of Kansas, On July 27, 1998, Mesa PDC, LLC, an indirect, wholly-owned subsidiary of Koch Industries, entered into an agreement with the New Mexico Highway and Transportation Department relating to the expansion of portions of State Highway NM 44 from two lanes to four lanes between the towns of San Ysidro and Bloomfield. The agreement set out terms for the construction and subsequent maintenance of the road for up to 20 years after completion. The agreement was in two parts and covered two separate phases of highway construction, referred to internally as the Construction Phase and the Rehabilitation Phase. Mesa was to receive $46,753,000 under the Professional Services Agreement for its Construction Phase services and $62,000,000 under the Pavement and Structures Warranties for its obligations under the Rehabilitation Phase, with $3,000,000 paid when the road design was complete, $6,000,000 paid at substantial completion of each of segments B, C, and D, and $41,000,000 paid at substantial completion of the road. [Complaint, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 3/3/06; Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 7/10/08]

x Although Mesa Earned $59 Million Of Income In 2000 And 2001, Koch Industries Reported A Total Of Approximately $1.4 Million Of Income Under The Agreement From 1998 Through 2001. According to the United States District Court, District of Kansas, On its consolidated income tax returns for the taxable years 1998 through 2001, Koch Industries treated the construction agreement as a long-term contract under Internal Revenue Code § 460, which permits a percentage of completion method of accounting for such contracts, reporting income from the contract as the company incurs the associated expenses of the contract. Mesa earned $59 million under the warranty portion of the agreement in 2000 and 2001, but spread that income out over the entire 20-year period of the agreement. Under the percentage of completion method, Koch Industries reported Mesa’s net taxable income under the construction agreement on its annual returns as zero dollars for 1998, $1,814,383 for 1999, $1,578,653 for 2000, and ($1,953,698) for 2001. [Complaint, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 3/3/06; Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 7/10/08]

x Koch Industries Filed Suit Seeking A Refund Of Approximately $20 Million For Taxes Paid Following The

Audit Of Its Tax Returns For 1998 Through 2001. According to the United States District Court, District of Kansas, Koch Industries paid the approximately $20 million dollars in additional income taxes assessed after the IRS’s audit of its tax returns for 1998 through 2001. The company submitted a formal claim for a refund of these amounts with the IRS on September 26, 2005. The Commissioner of the IRS disallowed Koch Industries’ claim in writing on December 30, 2005, saying Koch should have used an accrual method of accounting. Koch Industries then filed suit in the United States District Court for the District of Kansas, claiming an overpayment of taxes for the years 1998 through 2001 and seeking refunds of $234,259 for 1998, $1,214,537 for 1999, $2,537,683 for 2000, and $16,147,404 for 2001. The Complaint requested judgment in the amount of $20,133,883 plus interest and costs. [Complaint, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 3/3/06]

x Koch Industries Sought A Protective Order Over Documents Submitted In The Litigation. According to the United States District Court, District of Kansas, On August 4, 2006, Koch Industries filed a motion for a protective order,

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claiming that it is a privately held company that is not required to disclose tax information or contract details to the public, and contending that, without a protective order, competitors could use sensitive information to Koch’s disadvantage. Koch Industries sought a protective order for the following categories of documents: (a) plaintiff's federal, state, and local tax and information returns; (b) plaintiff's financial information, including income statements, balance sheets, scorecards, maintenance and reconstruction projections, cost summaries, and expenditure summaries; (c) proprietary information, including asphalt mix designs, database quality information, quality builder software, KMC sale and divestiture information, contracts and deal proposals; and (d) plaintiff's confidential information, including research, development, and commercial information. The government opposed the motion for a protective order, agreeing to limited protection of genuine proprietary information, but arguing that the protective order sought was too broad and was simply an attempt to shield the litigation from the public who had a legitimate interest, as it could result in a payment from the public treasury in excess of $20 million. The Court denied the motion for a protective order without prejudice on September 19, 2006. [Motion for Protective Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 8/4/06; United States’ Response to Plaintiff’s Motion for Protective Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 8/16/06; Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 9/19/06]

x Koch Industries And The Government Filed Competing Motions For Summary Judgment, Disputing Whether

Koch Industries Improperly Accounted For The Warranty Portion Of The Construction Agreement In Order To Gain Tax Benefits. According to the United States District Court, District of Kansas, On December 19, 2007, both Koch Industries and the government filed motions seeking summary judgment, presenting competing arguments as to whether the Pavement and Structures Warranties portion of the construction agreement constituted a traditional warranty under contract law. IRC § 460, under which Koch Industries accounted for the agreement, applies to long-term construction contracts and does not traditionally apply to standard warranties. Koch Industries contended that the use of the word “Warranty” in the contract heading was not indicative of the true nature of the contract, which was more akin to a traditional construction contract, and presented evidence that the company never internally viewed this portion of the contract as a traditional warranty. In response, the government presented evidence that Koch Industries did, in fact, understand the warranty portion of the agreement to be similar to other warranties, and sought to characterize the agreement as a long-term construction contract solely to achieve a tax benefit. Specifically, the government cited to an internal Koch Industries email, dated February 16, 2001, in which Robert Heitmann instructed Dale Gooch regarding language to be used in correspondence with the New Mexico Transportation Secretary in order “to have the potential desired tax effect upon audit,” stating “I have put certain words or phrases in bold that really should be part of whatever document you send to NM because these buzzwords would show the IRS the essence of our construction obligation. I am attempting to recast the maintenance activity as being more of ‘light’ construction activity so that it may also be shown as incident to and necessary as related to the secondary reconstruction activities. If we are successful at doing that, we may be able to include the maintenance revenues & costs in the LTC method along with the secondary reconstruction revenues & costs.” [Plaintiff’s Motion for Summary Judgment and Exhibits, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 12/19/07; United States’ Opposition to Plaintiffs’ Motion for Summary Judgment and Exhibits, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 1/11/08]

x The Court Granted Summary Judgment In Favor Of Koch Industries, Finding That The Pavement And

Structures Warranties Portion Of The Agreement Was Not A True Warranty And Awarding Koch Industries A Refund Of Approximately $20 Million. According to the United States District Court, District of Kansas, On July 10, 2008, the Court granted Koch Industries’ motion for summary judgment and denied the government’s motion for summary judgment. According to the Court, the use of the title “Warranties” did not indicate that the parties intended the agreement to be a traditional warranty, and the parties instead contemplated that the agreement called for substantial reconstruction and rehabilitation work throughout the 20-year life of the contract, differing significantly from warranties that had previously been used in the road-building industry. The Court stated: “Notwithstanding the fact that both parties and the FHWA understood that Mesa would be required to engage in reconstruction and rehabilitation during the Rehabilitation Phase, the parties called the Pavement and Structures Warranties, ‘warranties.’ All of the parties involved, including the FHWA attached no legal significance to that label. The Pavement and Structure Warranties were the first of their kind in the nation. The United States has pointed to no other project which has similar provisions.” The Court emphasized that Koch Industries was “well represented with legal counsel” in the negotiation of the agreement, because they “understood this thing would be under a great deal of legal and political scrutiny, so [they] had to ensure that every ‘I’

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was dotted and every ‘T’ was crossed.” Accordingly, the Court held that, because Koch Industries’ obligations under the agreement far exceeded those of any standard or performance warranty, Koch Industries was entitled to apply the provisions of IRC § 460, which governs long-term contracts. On October 21, 2008, the Court issued a judgment in Koch Industries’ favor pursuant to its July 2008 decision, ordering that Koch Industries was entitled to refunds in the amounts of $339,520 for 1998, $1,972,187 for 1999, $1,294,515 for 2000, and $16,596,092 for 2001. [Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 7/10/08; Judgment in a Civil Case, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 10/21/08]

x The Government Appealed The Grant Of Summary Judgment In Koch Industries’ Favor And The Appellate

Court Reversed The Decision, Directing Summary Judgment In Favor Of The Government. According to the United States District Court, District of Kansas, On December 19, 2008, the government appealed the Court’s decision granting summary judgment in favor of Koch Industries to the United States Court of Appeals for the Tenth Circuit. On April 27, 2010, the Court of Appeals reversed the district court’s grant of grant summary judgment and remanded the case to the district court for entry of judgment in favor of the government. The Court of Appeals held that IRC § 460 did not apply to warranties, and that Koch Industries’ percentage of completion method of accounting for the construction agreement was therefore inappropriate. On August 31, 2010, the district court reversed its prior summary judgment ruling under the mandate of the appellate court and entered judgment in favor of the government. [Notice of Appeal, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 12/19/2008; Appeal Mandate, “Koch Industries, Inc. and Subsidiaries v. United States, United States Court of Appeals, Tenth Circuit, Case No. 08-3347, Filed 4/27/2010; Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 8/31/10]

x Following The Grant Of Summary Judgment, Koch Industries Sought To Reinstate Alternative Claims For Tax

Refunds. According to the United States District Court, District of Kansas, On December 31, 2010, Koch Industries filed a motion to clarify the Court’s August 31, 2010 order granting summary judgment for the government, contending that it was still entitled to smaller tax refunds even if it was not permitted to use the percentage of completion method of accounting under IRC § 460. Koch Industries argued that the Court’s order did not extend to any claims beyond those specifically addressed in the summary judgment motions. The government disagreed, arguing that Koch Industries had waived any right to present alternative refund claims because it had not pursued those arguments throughout the prior four years of litigation. The Court ruled in Koch Industries’ favor, holding that its August 31, 2010 order was not intended to resolve any claims other than those relating to percentage of completion method of accounting under IRC § 460. [Plaintiff’s Motion to Clarify and Amend Order and Judgment Or, in the Alternative, to Vacate, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 12/31/10; United States’ Opposition to Plaintiff’s Motion to Clarify and Amend Order and Judgment or to Vacate, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 1/14/11; Memorandum and Order, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 4/12/11]

x 2012: The Parties Agreed To A Final Judgment Awarding Koch Industries Approximately $3.9 Million In Tax

Refunds. According to the United States District Court, District of Kansas, Koch Industries and the government agreed and stipulated that Koch Industries was entitled to tax refunds of $865,775.00 for 1998, $1,346,155.00 for 1999, and $1,658,947.00 for 2001. On April 18, 2012, the Court entered a final judgment for Koch Industries in the agreed amounts, plus interest. The Government appealed this final judgment on June 15, 2012, but voluntarily dismissed this appeal on July 9, 2012. [Final Judgment in a Civil Case, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 4/18/12; Notice of Appeal, “Koch Industries, Inc. and Subsidiaries v. United States,” United States District Court, District of Kansas, Case No. 06-1049-JTM, Filed 6/15/12; Order, “Koch Industries, Inc. and Subsidiaries v. United States,” Case No. 12-3160, Filed 7/9/2012]

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Kochs Advocate Against Corporate Responsibility For Criminal Action FOR THE KOCHS, CORPORATE CRIMINAL ACTIVITY IS ABOUT ECONOMICS AND PROTECTING THEIR OWN FUTURE INTERESTS, NOT RIGHT AND WRONG Federal Prosecutor David Uhlmann: The Kochs’ Advocacy For “Less Draconian Drug Laws” Could Be A “Stalking Horse” For Efforts To “Protect Corporate Criminals” And Reduce “Environmental, Health And Safety Laws.” According to the Washington Post, “‘Their advocacy for less draconian drug laws could prove to be a stalking horse for their long-standing efforts to protect corporate criminals and roll back environmental, health and safety laws,’ [federal prosecutor David Uhlmann] said.” [Washington Post, 8/15/15] THE REAL KOCH PRIORITIES ARE TO PROTECT THEIR CORPORATE CULTURE AND BUSINESS OPERATIONS Kochs’ Entry Into The World Of Criminal Justice Advocacy Koch’s “Come To Jesus” Moment On Criminal Justice Reform Involved Their Employees Being Indicted For Violating The Clean Air Act. According to Yahoo News, “The Kochs’ ‘come to Jesus’ moment on criminal justice reform came back in the 1990s, when a handful of their employees at a Corpus Christi, Texas, refinery were indicted for violating the Clean Air Act and other crimes. The charges against the employees were eventually dropped in 2001, but Koch, as a corporate entity, settled with the federal government, pleading guilty to one count of the original 97 and paying millions of dollars in fines. While the Kochs’ critics see this incident as an example of a company rightly being punished for polluting the environment, for Charles Koch and other company officials, it was a wake-up call that the government was over-criminalizing legitimate conduct and over-prosecuting its citizens. Mark Holden, Koch Industries’ top lawyer, said he worried that such scrutiny from the government would have an insidious effect on the company’s culture.” [Yahoo News, 11/12/14] Koch’s Top Lawyer Worried That Government Scrutiny Of Potentially Criminal Conduct “Would Have An Insidious Effect On The Company’s Culture.” According to Yahoo News, “While the Kochs’ critics see this incident as an example of a company rightly being punished for polluting the environment, for Charles Koch and other company officials, it was a wake-up call that the government was over-criminalizing legitimate conduct and over-prosecuting its citizens. Mark Holden, Koch Industries’ top lawyer, said he worried that such scrutiny from the government would have an insidious effect on the company’s culture.” [Yahoo News, 11/12/14] Charles Koch Was Motivated To Lessen Criminal Penalties Because Of Its Impact To Business Operations Charles Koch: “Experiencing Firsthand What The Criminal Justice System Can Do To A Company-And Worse, To Its Individual Employees-Has Made Me More Skeptical Of The Criminal Justice System And Some Criminal Convictions.” According to Charles Koch in his most recent book “Good Profit,” “Experiencing firsthand what the criminal justice system can do to a company— and worse, to its individual employees— has made me more skeptical of the criminal justice system and some criminal convictions. But it also reinforced our already strong commitment to never become complacent about compliance. The Department of Justice’s ninety-seven-count indictment was eventually reduced to seven counts. Outside experts advised KPG to plead guilty to a criminal charge, pay a fine, and move on. These experts also advised that the company should leave the indicted employees to fend for themselves against the government and turn over all attorney-client information to the government, which could then be used against the employees. We refused to do so because we did not believe the four indicted employees had done anything wrong.” [Charles Koch – “Good Profit”, 10/15] x Charles Koch: Koch Petroleum Group “Can Handle” Paying A Fine, But “We Had Four Innocent Employees

Indicted.” According to the Washington Post, “In Charles Koch’s opinion, the federal case was unjust. ‘We had four innocent employees indicted,’ he said. ‘Okay, the company can handle it. Okay, we pay a fine and so on. What’s so upsetting is seeing what it did to them personally and their families.’” [Washington Post, 8/15/15]

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Koch Industries General Counsel Mark Holden: Koch Petroleum Was “Railroaded” By The Corpus Christi Lawsuit, Which “Really Started Us Working On Criminal Justice Issues;” Kochs “In This For The Long Haul.” According to the Washington Post, “And Mark Holden, Koch Industries’ general counsel and senior vice president, said the company ‘was railroaded’ and its experience in the Corpus Christi case ‘is what really started us working on criminal justice issues.’ Of the skeptics, Holden said, ‘People are going to believe what they want to believe. We’ve been working on these issues for 12 years now. Charles has had these views his whole life, by and large. Just judge us by our actions. We’re in this for the long haul.’” [Washington Post, 8/15/15] Koch Backed Groups Advocated For Corporate Protection From Criminal Liability Charles Koch Institute Criticized That Regulations And Laws Within U.S. Code Should Include “Mens Rea” Provisions, Eliminating Accountability For Violating Laws & Regulations Without Intent CKI: The U.S. Code Is The Source Of Many Of The Criminal Justice System’s “Flaws” As It Contains More Laws Than Anyone Could Be Expected To Read Or Understand, And These Laws Often Have No Mens Rea Requirement, So People Can Be Found Guilty Of Committing Crimes Even If They Did Not Intend To. According to the Charles Koch Institute website, “Many of the [criminal justice] system’s flaws begin in the U.S. Code, which contains more laws than anyone could be expected to read or understand. The absence of a clear definition of a ‘crime’ has made counting the number of crimes on the books nearly impossible. The latest count puts the number at over 4,500. That, of course, does not even include the over 300,000 regulatory violations that carry criminal penalties. Many of those laws do not contain a mens rea requirement, meaning an individual who commits a crime without intending to can be found guilty nonetheless.” [Charles Koch Institute website, 11/3/15] Texas Public Policy Foundation Argued That A “Mens Rea” Provision Which Required Criminal Intent For Conviction Of A Crime Was Central To Criminal Justice Reform Texas Public Policy Foundation Center For Effective Justice Director Marc Levin: “A Mens Rea Provision, Requiring Criminal Intent For Conviction Of A Crime, Is Key To Criminal Justice Reform.” According to U.S. News & World Report, “‘A mens rea provision, requiring criminal intent for conviction of a crime, is key to criminal justice reform,’ said Marc Levin, director of the Center for Effective Justice at the Texas Public Policy Foundation, in an email.” [U.S. News & World Report, 10/1/15] Koch Funded Cato Institute Joined An Amicus Brief Which Argued That Prison Sentences For Corporate Officers Violate Due Process Shapiro & Meyer: Cato Joined An Amicus Brief In Support Of The DeCosters Stating That Prison Sentences For Corporate Officers Charged Under A Strict Liability Regulatory Regime Violate Due Process. According to a blog post by Cato Institute Senior Fellow in Constitutional Studies Ilya Shapiro and legal associate Randal John Meyer for Cato’s At Liberty Blog, “Joining the National Association of Manufacturers, Cato points out in an amicus brief supporting the DeCosters’ appeal that this case presents an opportunity for the U.S. Court of Appeals for the Eighth Circuit to join its sister court, the Eleventh Circuit, in holding that prison sentences constitute a due-process violation when applied to corporate officers being charged under a strict-liability regulatory regime.” [Cato.org/blog, 7/30/15] x Cato Institute Director Of The Project On Criminal Justice Tim Lynch: Congress Should “Discard The Old

Maxim That ‘Ignorance Of The Law Is No Excuse.’” According to the Cato Institute Director of the Project on Criminal Justice Tim Lynch’s testimony before the U.S. House Subcommittee on Crime, Terrorism, and Homeland Security, “Congress should take the following actions: Discard the old maxim that ‘ignorance of the law is no excuse.’ Given the enormous body of law presently on the books, this doctrine no longer makes any sense.” [Cato.org/publications, 12/13/11]

x Shapiro & Meyer: There Are About 300,000 Often “Ambiguous” And “Arcane” Regulations That Can Trigger

Criminal Sanctions, Counter To A Century Of Jurisprudence. According to a blog post by Cato Institute Senior Fellow in Constitutional Studies Iya Shapiro and legal associate Randal John Meyer for Cato’s At Liberty Blog, “Nearly a century of jurisprudence has held that imprisoning corporate officers for the actions of subordinates is constitutionally suspect, given that there’s neither mens rea (a guilty mind) nor even a guilty act—the traditional benchmarks of criminality

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since the days of Blackstone. Yet there are about 300,000 regulations that can trigger criminal sanctions. These rules are too often ambiguous or arcane, and many lack any requirement of direct participation or knowledge, imposing strict liability on supervisors for the actions (or inactions) of their subordinates.” [Cato.org/blog,7/30/15]

x Shapiro & Meyer: “Prison Is Not A ‘Relatively Small’ Penalty That The Supreme Court Has Allowed For

Offenses Without A Guilty Mind Requirement.” According to a blog post by Cato Institute Senior Fellow in Constitutional Studies Iya Shapiro and legal associate Randal John Meyer for Cato’s At Liberty Blog, “In United States v. Quality Egg, the district court ruled that courts have previously held that ‘short jail sentence[s]’ for strict-liability crimes are the sort of ‘relatively small‘ penalties that don’t violate constitutional due process. Such a sentence has only been imposed once in the history of American jurisprudence, however, and for a much shorter time on defendants with much more direct management of the underlying bad acts. Additionally, prison is not the sort of ‘relatively small’ penalty—like a fine or probation—that the Supreme Court has allowed for offenses that lack a guilty mind requirement.” [Cato.org/blog,7/30/15]

Cato Institute: The Possible Sentences Available Under The Responsible Corporate Officer Doctrine Should Be Narrowed Or Else “An Executive Of A U.S. Company Can Reasonably Fear Prison Time When His Or Her Company Inadvertently Commits The Wrong High-Profile Regulatory Violation.” According to an amicus brief submitted by the Cato Institute in support of the DeCosters, “Without a narrowing of the possible sentences available under the responsible corporate officer doctrine, an executive of a U.S. company can reasonably fear prison time when his or her company inadvertently commits the wrong high-profile regulatory violation. Corporations try very hard, for a variety of reasons, to stay in regulatory compliance. But when there are more than 300,000 regulations, many of which could lead to a potential criminal prosecution, employees will inevitably make mistakes despite best efforts to the contrary.” [Cato Institute amicus curiae US v. A. DeCoster, US v. P. DeCoster, 07/27/2015] Cato Institute Argued For Insulating Managers From Criminal Liability For Their Workers’ Corporate Offenses Cato Institute Senior Fellow In Constitutional Studies Ilya Shapiro And Legal Associate Randal John Meyer Wrote That Managers Shouldn’t Face Criminal Punishment For Corporate Offenses By Workers Under Their Supervision. According to a blog post by Cato Institute Senior Fellow in Constitutional Studies Ilya Shapiro, “It isn’t every day that a person can go to his or her job, work, not participate in any criminal activity, and still get a prison sentence. At least, that used to be the case: the overcriminalization of regulatory violations has unfortunately led to the circumstance that corporate managers now face criminal—not just civil—liability for their business operations’ administrative offenses. Take Austin and Peter DeCoster, who own and run an Iowa egg-producing company called Quality Egg. The DeCosters plead guilty to violating certain provisions of the Food, Drug, and Cosmetic Act because some of the eggs that left their facilities contained salmonella enteritidis, a bacterium harmful to humans. They were sentenced to 90 days in jail and fined $100,000 for the actions of subordinates, who apparently failed, also unknowingly, in their quality-control duties.” [Cato.org/blog, 7/30/15] Koch Funded Cato Institute Argued That Businessmen Can Be Jailed For Being At The Wrong Place At The Wrong Time Due To The Expansion Of The “Responsible Corporate Officer” Doctrine Cato Institute Senior Fellow Ilya Shapiro And Legal Associate Randal John Meyer: Businessmen Can Now Be Jailed Simply For Being In The Wrong Place At The Wrong Time As The Justice Department Has Expanded The ‘Responsible Corporate Officer’ Doctrine, Whereby Corporate Officers Can Be Held Criminally Liable For The Actions Of Their Underlings Without Any Knowledge Or Direct Participation. According to a blog post by Cato Institute senior fellow Ilya Shapiro and legal associate Randal John Meyer, “The current DOJ is also using law enforcement to advance President Obama’s vision of industrial policy. Under policies implemented over the last several years, businessmen can be jailed simply for being in the wrong place at the wrong time. The apotheosis of this trend came last month, when Deputy Attorney General Sally Yates issued a memo titled ‘Individual Accountability for Corporate Wrongdoing.’ The Yates memo notes changes to the department’s manual for U.S. Attorneys, revising the prosecution of corporate malfeasance in a way that overcomes the difficulty of establishing the culpability of ‘high-level executives.’ Since 2011, the Justice Department has pursued a line of litigation that expands the ‘responsible corporate officer’ doctrine, whereby corporate officers can be held criminally liable for the actions of their underlings without any knowledge or direct participation. More than 300,000 regulations — not even laws — can trigger criminal sanctions.” [Cato.org/publications, 10/30/15]

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x Shapiro & Meyer: “Sending People To Prison Without Their Direct Participation In Or Knowledge Of A Crime Raises Questions Of Due Process And Cruel And Unusual Punishment.” According to a blog post by Cato Institute senior fellow Ilya Shapiro and legal associate Randal John Meyer, “Until recently, the typical punishments under this doctrine have been fines or probation, not prison terms — per the two Supreme Court rulings that created it, United States v. Dotterweich (1943) and United States v. Park (1975). Sending people to prison without their direct participation in or knowledge of a crime raises questions of due process and cruel and unusual punishment.” [Cato.org/publications, 10/30/15]

More “Zealous Persecutions” Result In Corporate Officers Being Jailed For Violations Of Which They Had No Knowledge Of Shapiro & Meyer: Obama’s Justice Department Has Recently Pursued More Creative Regulatory Prosecutions, Including In United States V. Quality Egg, Where “Federal Prosecutors Finally Managed To Jail Corporate Officers Who Had No Knowledge Whatsoever Of The Violations They Were Jailed For.” According to a blog post by Cato Institute senior fellow Ilya Shapiro and legal associate Randal John Meyer, “Higgins wasn’t a clear signal that the government could seek prison terms for regulatory violations. The sentencing judge was highly attentive to the sophistication and ‘manipulat[ive]’ means directly employed by the executive — inferring knowledge and bad acts. But Obama’s Justice Department saw the case as an invitation to more creative prosecutions. Most recently, in United States v. Quality Egg, federal prosecutors finally managed to jail corporate officers who had no knowledge whatsoever of the violations they were jailed for. In that case, the defendants were the owner and COO of a company that introduced contaminated eggs into the stream of commerce — a strict-liability offense (no knowledge or intent required) under the Food, Drug, and Cosmetic Act. The defendants pled guilty but maintained that neither they nor their employees knew that the eggs were contaminated, and that they had no direct participation in the sale of bad eggs. The district court relied on Higgins and handed them a prison sentence. The case is now before the U.S. Court of Appeals for the Eighth Circuit under the name United States v. DeCoster.” [Cato.org/publications, 10/30/15] Shapiro & Meyer: These “Zealous Persecutions” Are Why Corporations Are “Reluctant To Invest In Their Businesses And Hire New Workers.” According to a blog post by Cato Institute senior fellow Ilya Shapiro and legal associate Randal John Meyer, “These zealous persecutions make clear why corporations now sit on record cash reserves and are ‘reluctant to invest in their businesses or hire new workers as uncertainty clouds the future.’ In short, commerce flows best when people don’t fear political prosecutions just for trying to grow their businesses. The president famous for saying that ‘if you’ve got a business, you didn’t build that’ has been using his Justice Department in a way that only slows economic activity.” [Cato.org/publications, 10/30/15] Koch Think Tank Argued That Overcriminalization Was “Particularly Egregious” In Relation To Business Regulation Cato: Overcriminalization Just Generally Refers To This Sort Of Idea That There Are Just Too Many Federal Crimes, And That People Don’t Know What Is Illegal Anymore. According to a Cato daily video featuring Molly Gill of Families Against Mandatory Minimum Sentencing, Molly Gill said, “Overcriminalization refers to the plethora of federal laws and regulations that are on the books now that carry criminal penalties. So as once we might regulate something and you get a fine for it or you get a disciplinary hearing by an agency and you get slapped on the wrist that way, now instead we are creating criminal penalties for this thing. So instead if you violate this regulation, now instead of a civil fine you get 0-6 months in prison and a criminal record. And overcriminalization just generally refers to this sort of idea that there are just too many federal crimes, and that people don’t know what is illegal anymore.” [Cato.org/multimedia, 7/18/13] x Cato: Overcriminalization Has Been Particularly Egregious In Areas Of Business Regulation. According to a

Cato daily video featuring Molly Gill of Families Against Mandatory Minimum Sentencing, Caleb O. Brown asked, “‘What are some examples where this has been particularly egregious?’ Molly Gill answered, ‘I think some of the areas of business regulation and particularly if you are doing something where you are bringing in say orchids from another country and you have to file special paperwork to bring those orchids in and if you file the wrong paperwork there’s a criminal penalty attached.’” [Cato.org/multimedia, 7/18/13]

Cato Institute Senior Fellow Walter Olsen: The Federal RICO Law Is Dangerous Because It Gives Prosecutors Leverage To Target Businesses. According to a blog post by Cato Institute Senior Fellow Walter Olsen for Cato’s At Liberty Blog, “I’ve been warning for years of the dangers of the federal Racketeering Influenced and Corrupt Organizations law and how it gives prosecutors and enterprising private lawyers leverage to target above-board businesses in search of

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punishment or profit. Since the law’s passage in 1970, RICO has seldom been used against violent organized crime. Instead, it has been aimed at a wide array of white-collar defendants, as William Anderson noted in Regulation six years ago, and especially at unpopular industries like gun and cigarette makers, as Cato’s Bob Levy noted in 2000. The latest fillip is Sen. Sheldon Whitehouse’s proposal to aim racketeering charges against groups that promote wrongful thinking on climate change.” [Cato.org/blog, 8/14/15] Contrary To Charles Koch’s Words In “Good Profit”, Cato Institute Argued Compliance With Federal Law Is “Difficult And Costly” For Companies Charles Koch On Compliance In “Good Profit”: “I Am An Engineer Who Places The Highest Priority On Safety And Compliance. In Fact, I Constantly Insist It Is ‘Job One’ For Every Koch Employee.” Accord to Good Profit, “I [Charles Koch] am also an engineer who places the highest priority on safety and compliance. In fact, I constantly insist it is “Job One” for every Koch employee. Why? Because I cherish the value of human life.” [Charles Koch – “Good Profit”, 10/15] Lynch: “Many Businesses Are Operating In What Is Essentially A Regulatory Police State.” According to a Cato Policy analysis by Cato Director of the Project on Criminal Justice Tim Lynch, “Many businesses are operating in what is essentially a regulatory police state.” [Cato.org/pubs, 4/20/95] Cato Institute Director Of The Project On Criminal Justice Tim Lynch: While Clinton’s Economic Strategy “That The Government Should Reward Those Who ‘Work Hard And Play By The Rules’” Appears Reasonable, “It Actually Fails To Appreciate The Legal Dilemmas Companies Face Daily Because Compliance With Federal Laws Is Difficult And Costly.” According to a blog post by Cato Institute Director of the Project on Criminal Justice Tim Lynch, “One recurring theme of President Clinton’s economic strategy is that the Government should reward those who ‘work hard and play by the rules.’ While that idea appears reasonable, it actually fails to appreciate the legal dilemmas companies face daily. The sheer number of state and Federal laws has always made compliance difficult and costly, but today companies increasingly find themselves in impossible situations because of conflicting mandates.” [Cato.org/pubs, 8/22/97] Koch Funded LIBRE Initiative Filed An Amicus Brief In Support Of A Challenge To Operation Choke Point For Its Damage To Business LIBRE Initiative Institute Filed An Amicus Brief In Support Of A Challenge To The Administration's Operation Choke Point, Arguing It Was Conducted “Without Accounting” For The Collateral Damage That It Has Done To Hispanic Businesses. According to a press release from the LIBRE Initiative, “Today the LIBRE Initiative Institute (LIBRE) filed an amicus brief in support of the Community Financial Services Association of America v. FDIC challenge to the administration's Operation Choke Point (Choke Point). LIBRE filed the brief - which was written by the nonprofit government oversight group Cause of Action - arguing that the government abused its power and conducted Choke Point without transparency or accountability and without accounting for the Collateral damage that it has done to Hispanic businesses, their customers, or the communities they serve.” [LIBRE Initiative Press Release, 10/9/14] x LIBRE Filed The Amicus Brief But It Was Written By The Group Cause Of Action. According to a press release

from the LIBRE Initiative, “LIBRE filed the brief - which was written by the nonprofit government oversight group Cause of Action - arguing that the government abused its power and conducted Choke Point without transparency or accountability and without accounting for the Collateral damage that it has done to Hispanic businesses, their customers, or the communities they serve.” [LIBRE Initiative Press Release, 10/9/14]

x LIBRE: Choke Point Is A FDIC Program To Investigate Business Activities “The Administration Believes To

Be Acting Against Public Interest,” Including “Legal Activities Such As Payday Loans, Tobacco, Ammunition.” According to a press release from the LIBRE Initiative, “Choke Point is an initiative quietly organized and implemented by the Federal Deposit Insurance Corporation (FDIC), the Department of Justice (DOJ), and other agencies. Banks and other financial institutions have been investigated and pressed to cut off financing to a range of businesses that the administration believes to be acting against public Interest . These include legal activities such as payday loans, tobacco, ammunition, fireworks, and many others.” [LIBRE Initiative Press Release, 10/9/14]

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x LIBRE Initiative Indicated Its Support For A Senate Amendment To The 2016 Budget Resolution To End The Program “Operation Choke Point.” According to a press release from the LIBRE Initiative, “The Senate Budget Committee recently approved an amendment to the 2016 Budget resolution to end ‘Operation Choke Point,’ a program run out of the Department of Justice that was initially intended to fight corruption. This amendment will be included as the Budget resolution goes forward to be debated by the entire Senate. Operation Choke Point is a program that was unilaterally put in place by the Obama Administration in 2013. It provides for higher scrutiny of banks and other financial institutions in the U.S. that do business with companies believed to be at higher risk for fraud and money laundering. However, as a result of this program, legally operating companies are having their banking services cut off because the government has deemed their business disagreeable, without having shown that the targeted companies are actually acting in violation of the law. Reports indicate that small businesses operating legally have been hurt by the loss of access to financing and Capital.” [LIBRE Initiative Press Release, 3/25/15]

Charles Koch Institute Advocated For Limiting Liability For Businesses Who Hire Ex-Offenders Reddy Said On Limiting Liability For Hiring Ex-Offenders, “If You Have Liability Caps And Limit The Damage, You Can Bring Down Insurance Premiums And People Who Want To Give People A Second Chance Are In A Good Position To Do So.” According to an interview of Charles Koch Institute senior research fellow Vikrant P. Reddy by Washington Post opinion writer Jonathan Capehart on the Kojo Nmadi show, “Limiting liability is another really important component of this. You will hear from people very frequently, business owners […] who say, ‘I would love to give someone a second chance, it’s personally important to me. I’d love to hire an ex-offender and help them get back on their feet but I can’t do it because there’s a risk, maybe it’s a 1% risk, there’s a risk that something will happen and then I could get sued. And because of that risk I have to buy insurance and the premiums are through the roof. And so, if you have liability caps and limit the damage, you can bring down the insurance premiums and then the people who want to give people a second chance are in a good position to do so.” [Kojo Nmadi show, 8/26/15] Koch Network’s Advocacy For Criminal Justice Reform Are Driven By Dollar Costs, Not Human Costs Levin: “The Primary Reason To Adopt” Criminal Justice Reform Policies “Is That They Are The Most Cost-Effective Way To Fight Crime.” According to Breitbart News, “‘Texans are clearly demanding a different solution to the state’s criminal justice problems, especially when it comes to nonviolent offenders,’ said Right on Crime Policy Director Marc Levin. ‘The primary reason to adopt these policies is that they are the most cost-effective way to fight crime, but it is reassuring to see that average Texans recognize this as well.’” [Breitbart, 3/10/15] x Cohen: Criminal Justice Reform Has Gained Prominence With Conservatives Because The Fiscal Argument Is

“Obvious – The U.S. Spends Billions On Courts, Police, And Correctional Facilities.” According to The Hill, “Derek Cohen, the deputy director of the conservative think tank Right on Crime, says the issue has moved to the forefront of the GOP primaries because it hits a conservative sweet spot. ‘It resonates with different conservatives for different reasons,’ Cohen said. ‘The fiscal argument is obvious — the U.S. spends billions on courts, police and correctional facilities. But you also have social conservatives concerned about what we’re doing to our communities, and libertarians suspect of government overreach.’” [The Hill, 7/15/15]

GenOpp: Punishments For Breaking The Law “Should Be Cost-Effective For Working Americans.” According to a post on the Generation Opportunity website, “We’re not saying that people shouldn’t be punished for breaking the law. But we do think the punishment should be appropriate to the offence, that it should be effective in deterring crime, and that it should be cost-effective for working Americans.” [Generation Opportunity, 9/30/15] x GenOpp: “States Spent Nearly Half A Billion Dollars To Arrest Marijuana Users” In 2014, Funding For The

Federal Bureau Of Prisons Was $6.45 Billion In 2013, And State Spending On Prisons Was $50 Billion. According to a post on the Generation Opportunity website, “According to data released on Monday by the FBI, 620,000 people were arrested for possession of marijuana in 2014. It breaks down to 1,700 people per day, or more than one person per minute. That doesn’t come cheap. At $750 per arrest, states spent nearly half a billion dollars to arrest marijuana users. And that doesn’t even come close to the amount of money we end up spending if we prosecute these marijuana users and send them to prison. Meanwhile, funding for the Federal Bureau of Prisons has increased from $3.67 billion in 2000 to $6.45 billion in 2013, constituting 25 percent of the Department of Justice’s budget. And on the state level, working Americans are paying $50 billion to keep the system afloat.” [Generation Opportunity, 9/30/15]

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GenOpp: Mass Incarceration Has Been Called A New Form Of Welfare And A Perverse Form Of Social Spending. According to a post on the Generation Opportunity website, “As the Atlantic’s cover story and explains, entire communities have been trapped in the poverty cycle, making time behind bars the Band-Aid for what ails large swaths of society – particularly young Americans within communities of color. Drug epidemic breaks out? Target the low-level sellers and users. Mentally unstable people? Lock them away behind bars. Unemployed and desperate? There’s a warm bed waiting in jail. It’s caused some to argue that mass incarceration has become a new form of welfare. The Atlantic elaborates: [‘]Mass incarceration is not just (or even mainly) a response to crime, but rather a perverse form of social spending that uses state power to address a host of social problems at the back end, from poverty to drug addiction to misbehavior in school.[’]” [Generation Opportunity, 9/24/15] Koch Groups May Recognize The Cost To Families, But Focus On Economics AFP: “Low-Level Criminals Should Be Paying Their Own Way By Continuing To Work, Live At Home, Support Their Families, Pay Taxes And Provide Restitution To Victims.” According to Americans for Prosperity’s “New Jersey Taxpayers’ Budget FY 2011,” “There is an understanding among those who run correctional institutions there are basically two types of criminals: ones at whom society is mad and the ones of whom we are afraid. There is a cost to Kansas taxpayers in apprehending, convicting and confining those who violate the law. This budget supports an emphasis on budgeting funds to protect citizens from the criminals of whom society is most afraid. Criminals such as petty thieves, drug users and bad check writers are criminals at whom society has plenty of reason to be mad. They should be punished for their crimes, but imprisonment for non-violent offenses does little to improve public safety or change behavior. It costs approximately $24,000 a year to house an inmate in a state facility and that doesn’t include other costs, such as supporting children while their parents are incarcerated. These low-level criminals should be paying their own way by continuing to work, live at home, support their families, pay taxes and provide restitution to victims.” [Americans for Prosperity, Commonsense Budget Proposal FY 2011] AFP: The Impacts On Families And Communities Are Even More Harmful Than The Immense Strain Forced On Taxpayers. According to a post on the Americans for Prosperity website, “Our prisons are 40 percent over-capacity and we continue to fill them with offenders serving jail time for minor, non-violent offenses. This places an immense strain on taxpayers paying to feed and house inmates, but the impacts on families and communities are even more harmful. Over 2.7 million children have one or both parents in prison, and two thirds are in for non-violent crimes. We need to find a way to help those who make bad decisions and commit non-violent crimes. Once they pay restitution, we want them get on with productive lives. The Mediaite/Koch Institute panel last week was provided an important step in addressing this critical issue.” [Americans for Prosperity, 4/28/14] Koch Affiliated Mercatus Center Referred To Volkswagen Deaths As A “Rounding Error” Mercatus Center General Director Tyler Cowen: “The Behavior Of Volkswagen Has Been Heinous,” But The Impact Of The Added Nitrogen Oxide Might Only Amount To A “Rounding Error” Of Between 5 And 27 Deaths. According to an opinion by Mercatus Center general director Tyler Cowen for the New York Times, “The behavior of Volkswagen has been heinous and the company and probably some of its executives deserve some serious punishments. Yet our reaction to the scandal is as illuminating as the misbehavior itself. […] The falsification of Volkswagen emissions software has meant more nitrogen oxide in the air, but how costly is this extra pollution in economic terms? One plausible estimate suggests this additional pollution has been killing 5 to 27 Americans each year, with that number worldwide reaching up to 404 as a maximum. […] Even within the United States, early deaths from air pollution have been estimated to run about 200,000 a year, in comparison to which the losses from the Volkswagen scandal are a rounding error.” [Tyler Cowen – New York Times, 9/29/15] x Cowen: Since The “Typical Value Of Life” Might Be Around $7 Million, “Volkswagen Has Been Destroying

Perhaps Around $100 Million In Value A Year,” Which Is Similar To The Cost To Market One Blockbuster. According to an opinion by Mercatus Center general director Tyler Cowen for the New York Times, “Although the practice is ethically controversial, some economists believe we can attach dollar values to human lives. A typical value of life, estimated by this method, might run in the neighborhood of $7 million. That would mean Volkswagen has been destroying perhaps around $100 million in value a year. To put that number in context, a single Picasso painting can cost that much, or a Hollywood studio might spend (waste?) that much money marketing a single blockbuster movie.” [Tyler Cowen – New York Times, 9/29/15]

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KOCHS COULD BE PARTY TO RICO LAWSUIT TARGETING THOSE FUNDING CLIMATE CHANGE DENIAL Guardian: A Group Of Climate Scientists Petitioned For An Investigation Of “Corporations And Other Organizations That Have Knowingly Deceived” The Public About The Risks Of Climate Change To “Forestall” America’s Response To Climate Change, Similar To How Tobacco Companies Misled The Public On Smoking. According to the Guardian, “Coinciding with the InsideClimate News revelations [that Exxon scientists were aware of climate change and conducted studies on it but changed direction in 1989], a group of climate scientists sent a letter to President Obama, his science advisor John Holdren, and Attorney General Lynch, calling for an investigation ‘of corporations and other organizations that have knowingly deceived the American people about the risks of climate change, as a means to forestall America’s response to climate change.’ In 1999, the Justice Department filed a civil Racketeer Influenced and Corrupt Organizations Act (RICO) lawsuit against the major tobacco companies and their associated industry groups. In 2006, US District Court Judge Gladys Kessler ruled that the tobacco industry’s campaign to ‘maximize industry profits by preserving and expanding the market for cigarettes through a scheme to deceive the public’ about the health hazards of smoking amounted to a racketeering enterprise.” [Guardian, 9/29/15] Koch Group Argued It Was “Astonishing And Dismaying” That Climatologists Used RICO Against Fossil Fuel Companies Who Are Only “Indirectly” Involved In Crimes Independence Institute Columnist Jay Ambrose: It Is “Astonishing And Dismaying” That 20 Climatologists Are Using RICO “Against Those Connected To Fossil Fuels Corporations” Who Argue That Global Warming “Is Not The Terror It Is Often Portrayed As Being.” According to an opinion by Independence Institute columnist Jay Ambrose for the Tribune News Service, “All of this and more is why it is so astonishing and dismaying — but also revealing — to see a group of 20 alarmed climatologists wanting to curtail debate on global warming by shutting up the opposition, and hardly by gentle means. The tool would be the Racketeer Influence and Corrupt Organizations Act, or RICO, allowing trials of those only indirectly involved in crimes. It was meant to heap massive damage on such groups as the Mafia, and it did. The climatologists want to use it against those connected to fossil fuel corporations who are arguing that global warming is not the terror it is often portrayed as being.” [Tribune News Service, 10/25/15] Ambrose: An Obama Administration Investigation Of Climate Deniers Backed By Fossil Fuel Corporations Would Amount To A “Massive Damage To Free Speech” And “Less Discernment In Coping With Climate Change.” According to an opinion by Independence Institute columnist Jay Ambrose for the Tribune News Service, “All of this and more is why it is so astonishing and dismaying — but also revealing — to see a group of 20 alarmed climatologists wanting to curtail debate on global warming by shutting up the opposition, and hardly by gentle means. The tool would be the Racketeer Influence and Corrupt Organizations Act, or RICO, allowing trials of those only indirectly involved in crimes. […] They have sent a letter asking President Barack Obama and others in his administration for an investigation, and what we will get if it comes is massive damage to free speech and something you would think an alarmist would fear: less discernment in coping with climate change.” [Tribune News Service, 10/25/15] OVERALL, KOCH NETWORK HAS ADVOCATED FOR DECRIMINALIZATION ACROSS THE SPECTRUM Koch Network Advocated Against Hate Crimes Cato Institute Director Of The Project On Criminal Justice Tim Lynch: “Even If It Presented No Constitutional Problem, It Would Still Be Unwise To Support Hate-Crimes Legislation.” According to a blog post by Cato Institute Director of the Project on Criminal Justice Tim Lynch, “Even if it presented no constitutional problem, it would still be unwise to support hate-crimes legislation. For one thing, it is imperative that federal law-enforcement focus on foreign threats, such as al Qaeda. One of the reasons the terrorists were able to elude detection prior to the September 11 attacks was that the FBI was charged with so many responsibilities that it lost sight of its most important responsibility — protecting the homeland from foreign threats. But the FBI was only trying to fulfill to the additional missions that the Congress assigned to it. A veto would underscore the point that there will be no backsliding while Bush remains in office.” [Cato.org/pubs, 5/3/07]

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Lynch: President Bush Should Again Assert That “All Crimes Are Hate Crimes” And “Remain Steadfast Against The Effort To Enact Federal Hate Crimes Legislation.” According to a blog post by Cato Institute Director of the Project on Criminal Justice Tim Lynch, “Many members of Congress recognize these problems, but they fret about the political risks involved in opposing a ‘hate crimes’ proposal. President Bush has been down this road before. In 1999, he refused to sign the ‘James Byrd Hate Crimes Act’ while he was governor by saying that ‘all crimes are hate crimes.’ As president, Bush should remain steadfast against the effort to enact federal hate crimes legislation.” [Cato.org/pubs, 5/3/07] Koch Network Advocated Against Zimmerman And Rodney King Assailants Being Held Accountable For Potential Federal Crimes After They Were Acquitted In State Courts Cato Institute Director Of The Project On Criminal Justice Tim Lynch: “The Zimmerman Case Is Actually A Good Recent Example Of How We Have Lost The Safeguard Against Double Jeopardy” As Federal Prosecutors Are Still Considering Involvement In The Case Despite His Acquittal In Florida. According to a Cato daily podcast featuring Cato Institute Director of the Project on Criminal Justice Tim Lynch, Lynch said, “And the Zimmerman case is actually a good recent example of how we have lost the safeguard against double jeopardy. If you have been following the news since the acquittal you may have heard the calls for, ‘hey he’s acquitted in state court, the federal prosecutors should get involved now and prosecute him in the federal system.’ And so we are awaiting right now Attorney General Eric Holder and his decision about whether charges will be brought against Zimmerman. The legal safeguard is not there, it’s like up to the discretion of the Attorney General who says he is studying the case. So that’s another example of how that safeguard has been weakened.” [Cato.org/multimedia, 10/1/13] Cato Institute Director Of The Project On Criminal Justice Tim Lynch: “The Double Jeopardy Clause Of The Fifth Amendment Is Designed To Protect Americans From Repetitive Prosecutions,” Yet Clinton Wrongfully Didn’t Stop “The Federal Prosecution Of The Los Angeles Police Officers Who Beat Up Rodney King.” According to a blog post by Cato Institute Director of the Project on Criminal Justice Tim Lynch, “The double jeopardy clause of the Fifth Amendment is designed to protect Americans from repetitive prosecutions, but the Clinton administration has signed off on several double prosecutions in recent years. For example, President Clinton could have stopped the federal prosecution of the Los Angeles police officers who beat up Rodney King, but he let that case go forward, apparently seeing no injustice in double jeopardy.” [Cato.org/pubs, 8/22/97]

Koch Hypocrisy On Reducing Prison Populations; Ties To Private Prisons, Profiting From Criminal Tracking, And Opposing Programs That Reduce Recidivism CHARLES KOCH INSTITUTE DESCRIBED THE LARGE NUMBER OF PEOPLE “LOCKED UP IN CAGES” UNNERVING… Charles Koch Institute Senior Fellow Vikrant Reddy: Libertarians Are “Unnerved” By The Large Number Of People “Locked Up In Cages,” And Criminal Justice Reform “Has Always Been An Issue” That Charles Koch Is “Very Passionate About.” According to The Progressive, “And then there are the libertarians, who Reddy says have always been interested in prison reform. They’re ‘unnerved’ by the vastness of the nation’s prison system, with huge numbers of people ‘locked up in cages.’ […] As for Charles Koch, ‘This has always been an issue he’s been very passionate about,’ Reddy says. ‘It’s something he’s cared about personally. It’s always been very clear to everyone on the right that Charles Koch has this one very high on his personal list.’” [The Progressive, 9/28/15] x Reddy Was Previously A Senior Policy Analyst For Right On Crime And The Texas Public Policy Foundation’s

Center For Effective Justice. According to Right on Crime, “VIBRANT [sic] P. REDDY is Senior Fellow for criminal justice issues at the Charles Koch Institute. Previously, Reddy was the Senior Policy Analyst for both Right on Crime and the Texas Public Policy Foundation’s Center for Effective Justice.” [Right on Crime, accessed 10/6/15]

…DESPITE ADVOCATING POLICIES THAT ENCOURAGED MORE INCARCERATION

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Koch Backed Americans For Prosperity Advocated In Support Of Private Prisons AFP Recommended New Jersey “Contract With Private Prisons Rather Than Investing In Any Further Facility Expansion, Construction Or Major Renovation.” According to Americans for Prosperity’s “New Jersey Taxpayers’ Budget FY 2011,” “Several large capital expenditures to expand or modernize prisons have been recommended by Corrections. Instead AFP recommends the agency contract with private prisons rather than investing in any further facility expansion, construction or major renovation. Private prisons fill a niche when the inmate population increases, or current facilities need costly renovations. Private prison per diem rates are less expensive than state-operated facilities, and do not require investments in infrastructure, maintenance or additional FTE. In addition, private entities often can construct a new facility in a year or less.” [Americans for Prosperity, April 2010] AFP: “Private Prisons Fill A Niche When The Inmate Population Increases, Or Current Facilities Need Costly Renovations.” According to Americans for Prosperity’s “New Jersey Taxpayers’ Budget FY 2011,” “Several large capital expenditures to expand or modernize prisons have been recommended by Corrections. Instead AFP recommends the agency contract with private prisons rather than investing in any further facility expansion, construction or major renovation. Private prisons fill a niche when the inmate population increases, or current facilities need costly renovations. Private prison per diem rates are less expensive than state-operated facilities, and do not require investments in infrastructure, maintenance or additional FTE. In addition, private entities often can construct a new facility in a year or less.” [Americans for Prosperity, April 2010] Koch-Affiliated ALEC Includes Private Prison Companies Among Its Members ALEC, The “Public-Private” Legislative Partnership’s “Corporate Roster” Includes The Nation’s Largest And Second Largest Private Jailers, The Corrections Corporation Of America, The GEO Group And The Koch Foundation. According to In These Times, “A 501(c)(3) nonprofit organization, ALEC bills itself as ‘the nation’s largest bipartisan, individual membership association of state legislators’ and as a public-private legislative partnership. As such, ALEC claims as members more than 2,000 state lawmakers (one-third of the nation’s total legislators) and more than 200 corporations and special-interest groups. The organization’s current corporate roster includes the Corrections Corporation of America (CCA, the nation’s largest private jailer), the Geo Group (the nation’s second largest private jailer), Sodexho Marriott (the nation’s leading food services provider to private correctional institutions), the Koch Foundation, Exxon Mobil, Blue Cross and Blue Shield, Boeing, Wal-Mart and Rupert Murdoch’s News Corporation, to name just a few.” [In These Times, 6/25/10] x ALEC Has 10 Task Forces Which Each Develop “Model Legislation” Even Though Federal Tax Law Explicitly

Forbids 501 (c) (3) Organizations Like ALEC In Taking Part In The Formation Of Legislation. According to In These Times, “ALEC is comprised of 10 task forces, each responsible for developing ‘model legislation,’ which ALEC member lawmakers then sponsor and introduce in their home states. This occurs despite the fact that federal tax law explicitly forbids 501(c)(3) organizations such as ALEC from taking part in the formation of legislation. ALEC promotional material boasts that each year member legislators typically carry 1,000 pieces of legislation back to their home states, 20 percent of which is passed into law.” [In These Times, 6/25/10]

Koch Network Advocated For Expanding The Use Of GPS Tracking, Which Benefits Koch Industries AFP Urged That New Jersey “Consider Expanding The Use Of GPS For All Probationers And Parolees” To Monitor Offenders Around The Clock At About One-Seventh The Cost And Carry Larger Case Loads. According to Americans for Prosperity’s “New Jersey Taxpayers’ Budget FY 2011,” “New Jersey already employees a strategy that has had great success in other states using global positioning systems (GPS) for post-release supervision and this budget urges some minor changes to make it even more effective. GPS allows probation and parole officers to monitor offenders around the clock, if necessary, and delivers supervision at about one-seventh the cost of incarceration. Former inmates think twice about violating their terms of release when they know someone is watching their every move. Some GPS units let officers send a text or voice message directly to the receiver worn by the offender. Also, an alert can be sent if the offender wanders into forbidden territory. Offenders can help defray the cost of monitoring on an ability-to-pay basis. California’s GPS program is supported 60% by offenders. New Jersey should consider expanding the use of GPS for all probationers and parolees, or at least those identified as higher-risk cases, which account for a large number of new prison commitments each year. GPS

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provides probation officers the ability to carry larger case loads, without endangering public safety.” [Americans for Prosperity, April 2010] x Molex, Inc. Makes MMCX Connectors Which Are Used For GPS Receivers. According to Molex’s website,

“MMCX 50 Ohm microminiature compact and lightweight connectors are designed for densely populated electronic packages with size and weight limitations. The mechanical stability is maintained via a snap-on interface that uses no slotting in the outer conductor. Typical applications include wireless/PCS devices, telecommunications, GPS receivers and consumer electronics. For medical MRI applications, non-magnetic versions are available. [Molex website, Accessed 10/27/15]

Kochs Opposed Programs That Would Help Combat Recidivism Koch Network Recognized The Problem Of Recidivism But Advocated Against Reforms Which Would Help Ex-Offenders Reenter Society GenOpp: Recidivism Is “A Societal And Economic Problem That Hurts Members Of Our Generation—And Taxpayers In General—Who Pay For These Re-Admissions To Prison With Their Tax Dollars.” According to a post on the Generation Opportunity website, “Recidivism, when former offenders are rearrested and sent back to prison, is a big problem in this country. Three years after being released, two-thirds of former inmates find themselves back in prison in large part because honest employment can be shockingly hard to come by for those with a criminal record. […] The problem is especially acute right after a prisoner’s release. Former offenders often find themselves back in their old neighborhoods with limited resources after they leave the halfway houses. At that point, they are confronted with three choices: go back to prison, live on the streets, or return to a life of crime. It’s a societal and economic problem that hurts members of our generation—and taxpayers in general—who pay for these re-admissions to prison with their tax dollars.” [Generation Opportunity, 8/31/15] Koch Millennial Group Opposed President Obama’s Program To Provide Pell Grants To Inmates Generation Opportunity Countered President Obama’s Program To Provide Pell Grants To Inmates With Alternatives That “Don’t Involve The Use Of So Many Federal Taxpayer Dollars.” According to a post on the Generation Opportunity website, “There are more than 2.3 million people imprisoned in the United States, and each year, 700,000 are released from federal and state prisons to return to their communities. However, within three years, 40 percent of those released will find themselves once again behind bars. Returning to criminal behavior after intervention or sanction for a previous crime is known as ‘recidivism.’ In order to combat this trend, President Obama announced the launch of a program last week that would provide Pell Grants to some inmates with the hope that access to higher education might reduce future recidivism rates. But there are other alternatives—ones that connect current and former inmates to education, jobs, and opportunity—that don’t involve the use of so many federal taxpayer dollars.” [Generation Opportunity, 8/3/2015] x GenOpp: “The First Problem With Taxes Is That They Take Resources Away From Businesses.” According to a

post on the Generation Opportunity website, “The first problem with taxes is that they take resources away from businesses—businesses that could be using that money to grow and hire more young people. The U.S. corporate tax rate is currently at 39.1 percent—the highest in the industrialized world. Meanwhile, large companies provide employment for over 45 percent of the U.S. population and create 65 percent of the new jobs in America. Imagine how much more they could invest in young employees if fewer of their resources were going to the government.” [Generation Opportunity, 8/7/15]

Koch Network’s Political Arm Advocated Against Providing Healthcare For Former Convicts AFP Attacked Medicaid Expansion In Maine For Covering Former Convicts. According to a Google cache of a post on the Americans for Prosperity website, “When Maine voters learn Medicaid expansion raids seniors’ Medicare, cannibalizes funding for critical state priorities and covers former convicts, while leaving vulnerable Mainers languishing on waitlists for services, support for this keystone of ObamaCare plummets among voters of every party, according to a poll released today by Americans for Prosperity-Maine and the multi-state Foundation for Government Accountability. […] ‘The results of this poll confirm why supporters of Medicaid expansion have been so hostile toward efforts to educate Maine patients and taxpayers about the true costs of this ObamaCare scheme,’ said Americans for Prosperity Maine State Director Carol Weston. ‘The more

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that Maine people know about the dangerous risks of Medicaid expansion, the more their opposition to it grows.’” [Americans for Prosperity, 3/26/14] x AFP: “At Least 35 Percent Of The Adults Made Newly Eligible For Medicaid By Obamacare Will Have A

History Of Involvement In The Criminal Justice System, Including Having Spent Time In Jail Or Prison.” According to a Google cache of a post on the Americans for Prosperity website, “Question 4[:] If you knew that almost 1 in 3 Mainers eligible for Medicaid expansion are former prison inmates, would you be more or less likely to support Medicaid expansion? […] BACKGROUND (Not included in poll question): According to estimates produced by the U.S. Department of Justice, at least 35 percent of the adults made newly eligible for Medicaid by ObamaCare will have a history of involvement in the criminal justice system, including having spent time in jail or prison.” [Americans for Prosperity, 3/26/14]

Koch Industries Wasn’t Lenient With Those Who Acted Criminally Against Georgia Pacific A Woman Plead Guilty To Mishandling More Than $395,000 Of Georgia Pacific’s Money. According to The Herald-Sun, “A 46-year-old Granville County woman was ordered to spend a year in prison after confessing to having mishandled more than $395,000 of Georgia-Pacific’s money while in charge of the books at the corporation’s wood products plant near Creedmoor. Katharina Hagwood Garner on Wednesday pleaded guilty to corporate malfeasance, while her ex-boss, Michael David Green, has a criminal case pending against him for allegedly aiding and abetting, Assistant District Attorney Cindy Bostic said.” [The Herald-Sun, 5/5/06] Kenneth Atkins Was Found Guilty Of Conspiracy To Commit Wire Fraud And Three Counts Of Money Laundering After Attempting To Defraud Georgia Pacific’s Crossett Mill. According to the Ashley County Ledger, “Kenneth Atkins, 55, of Crossett, was found guilty following a seven day jury trial before the Honorable U.S. District Judge Susan O. Hickey on one count of conspiracy to commit wire fraud and three counts of money laundering. The indictment that was at issue in the jury trial alleged that Atkins and a scale operator at the Georgia Pacific paper mill in Crossett worked together from January, 2011 through March 29, 2012 to manipulate the Georgia Pacific scale house computer to make it appear that a pulpwood load had been delivered to the paper mill on behalf of Atkins when in fact, no such load had been delivered and thereby caused fraudulent scale information to be sent via interstate wire transmission from Ashley County to Georgia. This caused Georgia Pacific to credit Atkins for the non-existent pulpwood loads as if they were real pulpwood loads. According to evidence presented at trial, 570 fraudulent scale tickets were submitted which resulted in a $459,791.73 loss to Georgia Pacific. Sentencing will be held at a later date.” [Ashley County Ledger, 10/22/15] KOCH SPENDING TOWARDS CRIMINAL JUSTICE REFORM IS FAR LESS THAN KOCH SPENDING FOR POLITICAL CAMPAIGNS Koch Spending On Criminal Justice Reform Is “Modest” Compared To Their Spending On Elections Time: “Compared To Their Spending On Elections, The Money The Kochs Are Funneling Toward Justice Reform Is Modest…And Holden Said There Are No Plans At The Moment To Increase The Financial Support For Justice Reform.” According to Time, “Compared to their spending on elections, the money the Kochs are funneling toward justice reform is modest. Their network plans to fork out nearly $900 million in advance of the 2016 election, according to reports—nearly as much as Barack Obama and Mitt Romney corralled in 2016 to support their campaigns. And Holden says there are no plans at the moment to increase the financial support for justice reform or form a new nonprofit devoted to the issue, although he wouldn’t rule it out.” [Time, 1/29/15] Daily Beast: The Kochs Have “Poured Seven Figures In Donations To The National Association Of Criminal Defense Lawyers” Over The Past Decade; “According to the Daily Beast, “Quietly over the past decade, a Koch Industries spokesman told The Daily Beast, the Kochs have poured seven figures in donations toward criminal justice reform, mainly through the National Association of Criminal Defense Lawyers. As a point of comparison, the Kochs spent at least $8.5 million on political campaigns in 2014 alone—to the benefit of Republicans across the country, and the dismay of Democrats.” [Daily Beast, 1/13/15] x Daily Beast: “As A Point Of Comparison, The Kochs Spent At Least $8.5 Million On Political Campaigns In

2014 Alone.” According to the Daily Beast, “Quietly over the past decade, a Koch Industries spokesman told The Daily

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Beast, the Kochs have poured seven figures in donations toward criminal justice reform, mainly through the National Association of Criminal Defense Lawyers. As a point of comparison, the Kochs spent at least $8.5 million on political campaigns in 2014 alone—to the benefit of Republicans across the country, and the dismay of Democrats.” [Daily Beast, 1/13/15]

Criminal Justice Reform Isn’t A Key Issue For Candidates Competing For Koch Dollars Kochs Have No Intention To Back Pro- Criminal Justice Reform Candidates Because “The Politics…Can Muddle Things.” According to Yahoo News, “For now, the Kochs have no intention of turning their financial support for the NACDL into a political effort. The American Civil Liberties Union, backed with money from liberal tycoon George Soros, plans to spend at least $50 million to make criminal justice reform an issue in elections around the country, the New York Times reported last week. In theory, the Kochs could use some of their considerable political spending to back pro-reform candidates, as well. ‘That’s not what’s driving what we’re doing,’ Holden said of the politics of criminal justice reform. ‘We are focused more on the society well-being side of it here. We should all put the politics aside because that can muddle things.’” [Yahoo News, 11/12/14] GOP Presidential Candidate Chris Christie: “David Or Charles Have Never Spoken To Me About Criminal Justice Reform.” According to the Daily Caller, “Asked if he’s been in contact with conservative billionaires Charles and David Koch on the issue of criminal justice reform, considering their well-known interest in the subject, Christie said they’ve always discussed other issues. ‘David or Charles have never spoken to me about criminal justice reform,’ he said.” [Daily Caller, 7/17/15] x Christie: My Conversations With The Koch’s “Have Been Predominately On Tax And Regulatory Reform And

Issues Like That.” According to the Daily Caller, “‘David or Charles have never spoken to me about criminal justice reform,’ he [Chris Christie] said. ‘My conversations with David and Charles over the years have been predominately on tax and regulatory reform and issues like that … but I welcome their support on it, because it’s an important thing to do.’” [Daily Caller, 7/17/15]