Philanthropist Forges Ties with School Through YSA Bishop, Missionary Experiences
By Ginny Romney, Deseret News Published: February 26, 2015
If anyone knows what it’s like to be a struggling college student, it’s Leo Beus, who has come a long way from his days of looking for rides from Salt Lake City to Provo.
“I would go out in a white shirt and a tie,” said the 71-year-old attorney who makes his home in Phoenix, Arizona. Beus attended BYU, and his wife, who had the car, attended the University of Utah. “I would take a legal pad and I would (write) in big bold letters … ‘BYU STUDENT, PROVO PLEASE.’ I could literally pick the car I wanted to ride in and they would take me to where I needed to go on campus.”
It’s just one experience that helps Beus empathize with students who are struggling to pay for schooling.
“I grew up in humble circumstances,” Beus said in an article published by Arizona State University, which has been the beneficiary of the Beuses’ generosity to a total of $15 million. “I grew up without the ability to attend a quality school without a scholarship.”
Beus and his wife, Annette, have made it possible for students to attend college through individual scholarships. And even though neither of them attended ASU, the couple recently gave $10 million to the university’s Sandra Day O’Connor School of Law’s Center for Law and Society. The Beuses have also forged ties with ASU students through missionary work and service in a young single-adult student ward.
In an interview with the Deseret News, Beus talked about growing up in Oregon and Washington in two vastly different towns. As a member of The Church of Jesus Christ of Latter-day Saints, he was in the religious minority in both places. He grew up in a town that was “a very friendly place to be a Mormon.” But after moving in the middle of his sophomore year of high school, he discovered that his new home was much more antagonistic.
“I ran for student body president at the end of my junior year,” he said. “All the signs that I had were marked up (with) beat-up Mormon adjectives that weren’t nice.”
But Beus prepared for a full-time mission by participating in missionary discussions and memorizing over 600 scriptures.
“We had missionary lessons in our home almost every Thursday night while I was in high school,” he said. “By the time I graduated from high school, we had about 25 people who had joined the church.”
He described his home as a place where the four missionaries serving in their branch were always welcome.
Beus decided to forgo a scholarship to Dartmouth to attend BYU. After a semester in Provo, he went on a mission to Belgium and Holland and learned two languages, even though his only request had been to serve in an English-speaking mission.
Following his mission, Beus returned to BYU and started dating Annette, who was a sorority sister to his cousin at the U. They met on a blind date to a Mormon Tabernacle Choir concert.
The couple graduated from their respective schools at the same time, then relocated to Michigan, where Beus received a full-ride scholarship at the University of Michigan Law School that required him to stay in the top 10 percent of his class.
When he graduated, Beus interviewed at 16 law firms in New York and received 16 offers.
“After that experience, I said, ‘That’s too much concrete for a farm boy,’ ” he said.
After interviewing with different firms in different states, Beus ended up in the Phoenix area.
Other than attending football games at ASU, he had “no connection” to the school until Patricia White, who served on the University of Michigan board of visitors with Beus, became the dean of ASU’s law school. Sometime later, Beus was called as the bishop of an ASU student ward.
“I saw the best kids I’ve ever seen in my life,” he said. “(They were) smart — I had doctors, I had law students, I had people getting Ph. D.s in physics. I had 97 percent attendance in sacrament meetings. They didn’t need a bishop. You could have just disappeared. It was really a marvelous experience.”
As bishop, he made missionary work a priority in the ward.
“The missionary piece of it really changes what happens in a ward,” he said. “In that entire time I was bishop, I never heard one person say one thing that was negative about another person. Do you know why? We never had a meeting where we didn’t have nonmembers. Ever. Nobody wants to be responsible for somebody not joining the church. That’s a whole level of guilt they don’t need. So we had none of that.”
Marcus Johnson, a former ward mission leader in the ward where Beus served as a bishop, said Beus is a “member missionary extraordinaire.”
“To say missionary work is important to Leo would be an understatement,” Johnson wrote in an email. “Wherever he is at in the world, he is talking about the gospel, whether to a waiter at a restaurant or those within his circle of influence.”
Johnson said the ward had between 25 and 30 ward missionaries at a time.
“Our baptisms would have the chapel completely full,” said Beus, crediting the success to members who would attend 30 to 35 weekly meetings with investigators. “I don’t think we had a month, we might have had one or two, where we didn’t have a convert baptism.”
As he worked with the students, Beus watched ASU become a comfortable place for students of faith to pursue spiritual and academic excellence.
White introduced Beus to ASU President Michael Crow, and the two became friends. Crow invited Beus to speak at some lectures for the law school. In return, Beus invited Crow to speak during sacrament meeting and later at a devotional with Elder D. Todd Christofferson.
After positive experiences with ASU students in his ward and the support he received from school leaders like White and Crow, Beus said, he thought, “maybe I need to make an investment in this.”
The Beuses started the Beus Family New American University Scholarship for incoming freshmen or community college transfer students who are worthy LDS members and academically impressive students invested in science, technology, engineering, math, or music degrees.
“So we’ve got STEM with two M’s,” Beus said, explaining that his wife, who is a great lover of music, insisted they add the second M.
Beus said they gave eight scholarships this year — some to students who had been accepted to Ivy League schools. The Sandra Day O’Connor School of Law’s Center for Law and Society is scheduled to open in 2016 at the downtown Phoenix campus.
“Leo and Annette Beus are great friends to ASU,” Crow wrote in an email. “They are committed to bettering the lives of young people and have embraced our institutional mission to provide broad access to a high-quality education for all qualified students, regardless of socioeconomic status.”
Beus said his experience wouldn’t have been the same if he hadn’t been the bishop of the student ward. “Where do you get the experience where you can have a great university, a really warm culture, and a missionary experience?” he said.
MagCorp Trustee Kicks Off $118M Rennert Looting Trial
Andrew Scurria, Law360 Published: February 2, 2015
Lawyers for a bankruptcy trustee accusing industrial magnate Ira Rennert of plundering $118 million from Magnesium Corp. of America told a Manhattan jury on Monday that dividends extracted by the billionaire’s Renco Group Inc. left MagCorp “doomed to fail” and creditors out of the money.
After seating a 10-person jury for the multiweek trial, U.S. District Judge Alison Nathan let attorneys for MagCorp’s Chapter 7 trustee present an opening statement outlining how they say Rennert drove the magnesium producer he owned into bankruptcy and wiped out its creditors.
More than a decade in the making, the lawsuit turns on a $150 million bond offering in 1996 that Rennert allegedly used to pay himself and his deputies while leaving MagCorp overleveraged and undercapitalized.
The trustee, Lee Buchwald, says that Rennert caused MagCorp to pay out improper dividends, stock redemption payments, and executive compensation while the facility was struggling with the overseas competition and environmental liabilities that foretold its demise. MagCorp operated primarily from a Rowley, Utah, facility that produced magnesium out of brine dredged from the Great Salt Lake.
MagCorp entered bankruptcy in 2001, and “not one penny” of principal on the bond debt was repaid, the trustee’s attorney Leo R. Beus of Beus Gilbert PLLC told the jury.
“They could never get out from under that $150 million in debt,” Beus said. “Mr. Rennert made a bad business decision when he bought the facility … but he doesn’t take responsibility for that bad decision.”
The case has put a spotlight on Rennert, an industrialist who built Renco into a powerhouse conglomerate with holdings from the Rust Belt to South America by buying and selling distressed businesses, often in bankruptcy.
Perhaps best known for erecting a lavish and controversial 67,000-square-foot mansion in the Hamptons, Rennert is expected to make a rare public appearance on the stand during the three- to four-week trial. Rennert’s attorneys are scheduled to wrap up their opening statement Tuesday. They tried and failed to preclude the trustee from showing the jury photographs of Hampton’s residence.
In court papers, the trustee has accused Renco of seizing on a brief spike in magnesium prices to justify raising new debt in 1996. The bond offering allegedly doubled MagCorp’s long-term indebtedness and pushed its shareholders’ equity underwater by $81 million.
Rennert justified the offering based on predictions that magnesium prices would stay at record levels for years, but prices quickly dropped well below the $1.60 per pound that MagCorp needed to break even, according to the trustee.
The lawsuit contends that Rennert profited while knowing the company would soon be unable to service its bond debt or install badly-needed technology upgrades.
The final blow came in January 2001, when the U.S. Environmental Protection Agency sued MagCorp for $900 million in cleanup costs connected to the facility’s release of chlorinated hydrocarbons and other pollutants. MagCorp filed for Chapter 11 less than eight months later and subsequently converted the case to a liquidation.
The trustee sued Renco in 2003 along with other firms involved in the bond offering, including Renco’s law firm Cadwalader Wickersham & Taft LLP, accounting firm KPMG LLP and financial adviser Houlihan Lokey LLP.
In 2009, U.S. Bankruptcy Judge Robert E. Gerber cut Cadwalader, KPMG, and Houlihan Lokey from the suit but refused to release Renco, Rennert, or his deputies, whose compensation was allegedly tied to the improper dividends. The trustee then took his claims against the remaining defendants to federal court for trial.
The lawsuit brings claims for unjust enrichment and depends on a finding that MagCorp was inadequately capitalized or insolvent after taking on the new debt.
The trustee is represented by Leo R. Beus, Scot C. Stirling, Malcolm Loeb, and Robert O. Stirling of Beus Gilbert PLLC.
Renco is represented by H. Peter Haveles Jr. and Jeffrey A. Fuisz of Kaye Scholer LLP; and Tai H. Park and Steven C. Bennett of Park Jensen Bennett LLP.
The case is Magnesium Corporation of America et al. v. The Renco Group Inc. et al., case number 1:13-cv-07948, in the U.S. District Court for the Southern District of New York.
“The List: ASU Driving Downtown Development”
By Mike Sunnucks, The Phoenix Business Journal Published: October 3, 2014
Prominent Phoenix attorney Leo Beus has donated $10 million to Arizona State University to help build its new law school. The donation is part of a $50 million fundraising campaign by ASU’s Sandra Day O’Connor School of Law, which plans to move 1,000 students, faculty…
Beus Gift to Law Center Reflects Affinity for ASU, Concern for Fellow Citizens
By Erik Ketcherside, ASU News Published: September 22, 2014
When Leo and Annette Beus arrived in Arizona in 1970, he was fresh out of law school and the young couple was, he says, “starting out broke.”
When it came time to donate to their most cherished causes, Arizona State University didn’t make the list. As a graduate of Brigham Young University and the University of Michigan Law School, Leo says he was fiercely devoted to his alma maters, and Annette to hers: the University of Utah.
They still are, Leo Beus says, but their relationship with ASU is another story.
During 43 years of successfully practicing law in the Valley, Leo Beus says he and Annette have forged strong ties to ASU that have given them an insider’s view of the university. They have seen ASU dramatically improve its academics and research, and become an invaluable asset to the community – one that they are proud to support.
The Beuses believe so strongly in ASU’s potential that they recently gave $10 million to the Sandra Day O’Connor School of Law’s Center for Law and Society, scheduled to open in 2016 at the Downtown Phoenix campus.
“Leo and Annette Beus have long supported ASU because they recognize the meaningful ways this university can positively impact our communities and society in general,” said ASU President Michael Crow in announcing the gift. “Their most recent investment is a reflection of their deep commitment to helping us build a center that will become a major part of our city and state’s future; theirs is a contribution to the well-being of our fellow citizens.”
The gift is the most recent evidence of the Beuses’ generosity to ASU and brings their total commitment to $15 million. Past gifts have enriched a range of programs, including student scholarships and service groups; a teaching award and an endowed chair; the college of law; and Sun Devil Athletics.
They felt drawn to contribute to the law school because Leo Beus says it reflects ASU’s commitment to access – affording students of every economic background the opportunity to earn a degree without accruing great amounts of debt.
Leo Beus says he empathizes with students who struggle to pay for higher education. “I grew up in humble circumstances,” he says. “I grew up without the ability to attend a quality school without a scholarship.” ASU’s commitment to including people who otherwise could never attain higher education meets a great need in society.
“I’m seeing ASU just close that gap,” he says. “It’s a blessing to the community, it’s a blessing to the downtown and it’s a blessing to the students.”
He and Annette are also deeply impressed by Crow’s vision to embed ASU within the community and produce scholarship that improves people’s lives. The Center for Law and Society is a great example of that commitment, he says.
The center is designed to be a model for public legal education. Situated in the heart of downtown near state and federal courts and many law offices, it will allow students unprecedented access to and cooperation with legal professionals. It will offer forums for continuing education, lectures, and conferences. One of its greatest innovations will be the world’s first nonprofit, teaching law firm that will serve Arizonans. The Beuses’ gift, the largest philanthropic investment to date on behalf of the law school, will be used for building and capital support.
“The concept from the start has been that the Center for Law and Society will be a community centerpiece that will strengthen our connections to those we serve,” says Douglas Sylvester, dean of the College of Law. “With such generous support from Leo and Annette, this center will help transform the Sandra Day O’Connor College of Law, its students and faculty, our community, and this great state for many generations to come. The Beuses have set a standard of support for what we are today and what we will become in the future.”
The Beuses’ generosity also demonstrates the positive impact of private investment in ASU, says R. F. “Rick” Shangraw Jr., CEO of the ASU Foundation. “This most recent commitment to the Center for Law and Society is further evidence of Leo and Annette’s belief in the vision of a New American University that exists to better our communities,” he says. “Their continued support is making a meaningful difference in the lives of this university’s students and faculty, and in the advancement of its programs.”
The story of how the couple created strong ties to ASU can be told one relationship at a time, Leo Beus says. Many were forged when he served as bishop with Annette of a Young Single Adult Ward at the LDS Institute at ASU.
Each week, they heard from students how ASU was changing their lives. Sometimes it was a scholarship that provided access to higher education; other times it was a program that nurtured a student’s talents and ambitions. “What ASU was doing for their lives was enormously important,” he recalls.
The Beuses also saw that ASU leaders were serious about making the university a place where students of faith could pursue spiritual and academic excellence.
Leo Beus also notes his friendship with former law school dean Patricia White, with whom he worked to create an endowed chair named for Charles Jones, Jr., a former chief justice of the Arizona Supreme Court. Leo Beus credits White with laying the groundwork for the spirit of openness and cooperation between the law school and the wider community that will be realized in the new downtown center.
He and Annette are eager to contribute to its momentum. “This donation was a big step for us,” says Leo Beus, a principal in the firm Beus Gilbert. “But we have been very fortunate in big-case litigation, and Annette and I are happy to do it.”
He says private support from the community is a vital component of ASU’s rise to excellence. “If we could get ASU to the next level, the blessing it would be on the lives of the people of Arizona would be monumental.”
Pfizer, BYU Settle Celebrex Lawsuit for $450M
By Tom Harvey, The Salt Lake Tribune Published: May 2, 2012
One month from the scheduled beginning of a complex eight-week trial, Brigham Young University, and drug giant Pfizer Inc. settled a lawsuit Tuesday for $450 million over whether the Utah school had been cheated out of billions of dollars in royalties for aiding in the development of the wildly successful anti-pain drug Celebrex.
Terms of the settlement of the nearly 6-year-long legal dispute were not disclosed in a Pfizer press release but the New York-based company reported separately that it had taken a $450 million charge against its earnings to settle the matter.
BYU claimed in the lawsuit filed in October 2006 that professor Daniel Simmons had discovered an enzyme and a gene called Cox 2 that would allow for the development of an anti-inflammation drug that did not have the long-term side effects of aspirin. The school entered into a contract with Monsanto for a joint research project to develop a drug with BYU supposed to receive royalties.
The Provo school claimed that discovery was a key to the development of Celebrex but Monsanto, which eventually became part of Pfizer, arbitrarily canceled the contract, did not place Simmons on patents and misappropriated his work to create the drug. The product was one of the most financially successful of all time, bringing in revenues of perhaps $35 billion, according to court papers.
BYU has claimed it was owed at least $9.7 billion in royalties, but Pfizer’s exposure at trial was possibly much greater because the jury could have taken the total revenue from Celebrex sales and imposed triple damages.
With a trial scheduled to begin May 29, the two parties sat down Friday for settlement talks in Salt Lake City before U.S. District Judge David Sam. Pfizer put out a news release Tuesday morning announcing that the company had “reached an amicable settlement on confidential terms.” The company declined further comment.
BYU said only, “We are very pleased with how this matter has been resolved. By terms of the settlement, our response this morning can only reiterate what is stated in the released press statement.”
As part of the settlement, Pfizer said that BYU will establish a Dan Simmons Chair in recognition of Simmons.
“We are pleased to resolve this matter and the uncertainty of litigation, and to be in a position to support Dr. Simmons’ research efforts at BYU,” Pfizer said in its statement.
Pfizer had argued in court documents that Simmons’ discovery was not a key to the development of Celebrex, which was largely the result of the work of its own scientists.
Pretrial rulings in March by U.S. District Judge Ted Stewart largely favored BYU and would have allowed the school’s attorneys, led by Leo Beus of Beus Gilbert of Phoenix, to go to the jury with their legal arguments and evidence largely intact.
In another pretrial jockeying last week, Pfizer had claimed that BYU had tainted the potential jury pool by way of a news media blitz that included interviews given to local television stations. BYU is owned by The Church of Jesus Christ of Latter-day Saints, and about 60 percent of Utah residents are members.
In an emergency motion calling for the trial to be moved, Pfizer said, “Whatever hope there may have been of obtaining jurors who, despite potential ties to important local institutions such as BYU or the LDS Church, could be impartial, BYU has now willfully made that task impossible.”
BYU’s attorneys said the claim was without merit.
A BYU spokesperson on Tuesday declined to say what the school’s annual budget is or to what use it might make of the settlement monies.
According to court papers, BYU also had been pursuing a licensing agreement with Teva Pharmaceuticals, a generic drug maker, to license Simmons’ discoveries should BYU have prevailed at trial on patent claims. With the settlement, that apparently is no longer a possibility.
BYU’s $1 Billion Lawsuit Accuses Pfizer Of Fraud
By Lois M. Collins and Geoffrey Fattah, Deseret Morning News Published: October 19, 2006
Brigham Young University and one of its professors are suing pharmaceutical giant Pfizer, claiming BYU was defrauded of profits of at least $1 billion and credit for work that led to the blockbuster drug Celebrex.
The lawsuit, filed Wednesday in U.S. District Court in Salt Lake City, weaves a tale of a trusting university that didn’t know much about patents in biomedical breakthroughs and that was allegedly deceived by an experienced drug company.
The medication, in the non-steroidal anti-inflammatory drugs (NSAID) class, is one of the so-called “super-aspirins.” Celebrex and its second-generation drugs have had sales of more than $20 billion. The super-aspirin blocks the COX-2 enzyme, reducing pain and inflammation without triggering the sometimes-deadly gastrointestinal effects of some other NSAIDs, including aspirin. COX is a scientific shorthand for the enzyme cyclooxygenase.
The lawsuit asks for a jury trial in its claim that Pfizer and its predecessor companies, including Monsanto, unjustly took credit for and profited from the work of Daniel L. Simmons, a professor of biochemistry at BYU. The complaint alleges both fraud and misappropriation of trade secrets and says BYU and Pfizer’s predecessor company Monsanto had a contract to develop such drugs together.
The pharmaceutical company instead terminated the contract “under fraudulent pretenses,” hid information that BYU was entitled to about patents, and profited handsomely while shutting the university out, the lawsuit says.
The lawsuit estimates the university’s lost potential revenue is in excess of $1 billion but does not specify a dollar amount for damages. Instead, the complaint asks that those be determined at trial.
The complaint also asks for a directive to the U.S. Patent and Trademark Office to issue a certificate of correction to various patents saying Simmons was erroneously omitted as an inventor, punitive damages, and costs associated with the litigation.
Simmons said in a statement that he looked forward to receiving proper credit for his work. “I appreciate the support of the university, and I’m grateful that the real story behind this research will come out,” he said.
A Pfizer spokesman denied the accusations.
“Dr. Simmons played no role in the discovery of Celebrex, and the allegations raised by BYU and Dr. Simmons are baseless,” said Pfizer spokesman Bryant Haskins, in a statement. “The facts simply don’t support the unfounded claims made in this lawsuit, and Pfizer will, of course, mount a vigorous defense.”
BYU spokesman Michael Smart said the university had attempted to resolve this dispute for years before filing suit.
“BYU initiated phone calls and letters about this issue more than seven years ago,” he said, and university officials also formally met four times with company executives.
The university and Pfizer agreed in January to hire a professional mediator but have been unable to resolve the issue. “Monsanto and its successors gave the university no choice,” Smart said.
BYU maintains in the lawsuit that Simmons discovered the COX-2 enzyme and signed a contract with Monsanto to develop NSAIDs that would protect the stomach while tackling pain and swelling. Instead, the lawsuit says, Monsanto advised BYU against getting patents that the company said would be unenforceable and promised to let the university know if something that could be patented came out of the work.
Patents did, in fact, result, but BYU was not told that it could have had a part in them. The lawsuit asks that dozens of existing patents be changed to reflect Simmons’ role in discovering COX-2 and crediting him as an inventor.
Instead of living up to the contract, the lawsuit alleges that Monsanto officials started taking credit for the COX-2 discovery and cites examples, including news articles where a Monsanto scientist claims he discovered COX-2.
“Dan Simmons and BYU had a written contract with Monsanto to use his recent discovery of COX-2 to collaborate in the development of a new aspirin-like drug,” said Smart. “Until then, Monsanto had been heading down a different research path. Our lawsuit says they took Dr. Simmons’ findings and discoveries and went on to develop a blockbuster drug without him, which we believe violated the contract by sharing none of the credit or compensation.”
The lawsuit asks that dozens of COX-2-related patents be corrected to reflect Simmons’ role. “These patents were all based on the work of Dr. Simmons,” the lawsuit says.
In at least two Monsanto patents, the lawsuit says, “Monsanto fraudulently misrepresented that its cell-testing systems were constructed using human or murine COX-1 or COX-2 fragments” from a Michigan company. “Dr. Simmons has recently learned,” the complaint says, that the cell systems in at least one case “were made using the clones Dr. Simmons had provided Monsanto.”
The lawsuit also claims that the drug company misrepresented to the Food and Drug Administration Monsanto’s “true role” in the development of Celebrex.
At the time Monsanto and BYU entered into their agreement, Monsanto was trying to develop a steroid-like project and was testing compounds for NSAID properties only so it could eliminate them from consideration, the complaint says.
Haskins said Pfizer did acknowledge that Monsanto had a research agreement with Simmons and BYU, but when asked to what extent Simmons’ research was used in the company’s COX-2 project, Haskins said the company would not comment on pending litigation.
The lawsuit says that BYU was not aware that it had been cheated of credit and proceeds it was entitled to under the contract until information came to light in another lawsuit. In 1998, pharmaceutical company Merck asked Simmons to testify in Monsanto’s patent infringement suit against Merck, the BYU lawsuit says, and that’s when Simmons learned that Monsanto was taking sole credit for the discovery of COX-2.
In another lawsuit with the University of Rochester, the BYU complaint says, Monsanto in a brief said that “Brigham Young’s scientists were the first to identify methods of treatment using selective COX-2 inhibitors.”
When BYU tried to resolve the issues with Monsanto, the lawsuit says, the company initially denied “even knowing who Dr. Simmons was. When confronted with the signed agreement,” the complaint says, “Monsanto admitted to working with Dr. Simmons” but continued to deny working with them on a project to develop a COX-2 selective NSAID.
Alumni President Devoted To BYU, Service
By Charlene Winters, Brigham Young University Alumni Magazine Published: Fall 1998
If BYU’s Alumni Association president were to open a vein, his blood would probably run blue. That’s because Paul E. Gilbert has been associated with BYU throughout his life and says he still feels inspired and thrilled every time he comes to campus.
The Phoenix-based attorney’s affiliation began in childhood when he attended BY Elementary, BY Junior High, and BY High School. He then attended BYU as a history major and served as student body president. His father, who died while Gilbert was a child, was a BYU assistant football coach, and his second father was a BYU dean. The roots go even deeper. His mother taught English at BY High, all seven of his brothers and sisters have attended BYU, and the tradition is continuing with his own children.
“My wife Susan and I have consistently brought our children to Provo for Homecoming to create a feeling of excitement about coming to this fine school,” he says. “Two of my children have already graduated from BYU, another is attending the university, and my last child, a senior in high school, plans to attend BYU.
“That will make us four for four,” he adds. “We do believe in free agency in our home. I have told my children they could attend whatever college they wanted, but I have always added that BYU was paid for.”
Although Gilbert attended the University of California, Berkeley, for his law degree, he says that, despite receiving a very good education there and forming some close and lasting friendships, his feelings toward UC Berkeley don’t approach the depth of his commitment to BYU.
“I think my alliance to BYU is closely akin to my feelings and support for the LDS Church,” he explains. I also think BYU is such a unique institution that it engenders uncommon loyalty. We feel a real bond with our fellow graduates because of our common goal–and that again comes back to the Church. We are more united as a student body in our goals and aspirations than any other student body in the world.”
“Paul Gilbert is a natural choice for alumni board president,” says George Bowie, executive director of the Alumni Association and an assistant advancement vice president. “He has consistently demonstrated his commitment to BYU and his willingness to help the university in any way.”
When he graduated from BYU in 1968, Gilbert says he left with a feeling of profound joy for the BYU experience and says that whenever he steps on campus, it floods him with pleasant and treasured memories.
“Frankly, I’m always a bit proud to know that I am affiliated with a university that is doing great things and that just gets better and better with time,” he says.
He acknowledges that BYU has undergone major changes in the 30 years since he was a student, but he believes the things that make him love and appreciate BYU have stayed constant.
“BYU continues to be run by an inspired board of trustees with rigorous adherence to Church standards. It remains full of clean-cut young people who believe as I do and who are part of the big picture that is changing the world. It also remains a university where real and meaningful truths are being taught across the disciplines. I just have a feeling BYU is playing and will continue to play an even more important role in the future in helping spread the influence and message of the gospel.”
Even after leaving BYU, Gilbert continued to serve the university. His deceptively simple philosophy about volunteer service–“I do what I am asked”–belies his deep commitment not only to BYU but also to causes in Arizona, where he serves on the board of the John C. Lincoln Foundation (one of the larger hospitals in Phoenix) and the National Conference of Christians and Jews.
“I believe in service,” he says. “I have been an admissions advisor since I was BYU student body president. I helped recruit students when I was a senior there. I helped with fundraising, and I served with the alumni. I have also been a leader of BYU’s alumni chapter in Phoenix.”
Gilbert encourages participation in regional chapters as a way of remaining involved with BYU. “I think many alumni are fiercely loyal to BYU and want to do something that links them to the university,” he says. “Yet they may not know how to do it or where to go. My answer to that question is to join and participate in local chapters.”
Gilbert’s goals as BYU Alumni Association president–a position he will hold through 1999–are many. He looks to the chapters to help coordinate with the BYU Management Society, BYU Law Society, Collegium Aesculapium, and other BYU groups. He wants to encourage regional scholarships to help worthy students who otherwise could not afford to attend BYU. He would like to see chapters participate in community activities that raise awareness about BYU. And he supports chapters as a major force in BYU’s capital campaign fund-raising efforts.
Additionally, he wants to see alumni assist each other in finding jobs. “We have a placement office–you can find it under the Alumni Association’s Web site on the Internet. Alumni should help each other.”
Particularly important to him during his tenure, he says, is to find ways to help alumni understand that the Alumni Association is their advocate and representative to BYU.
A strong believer in community involvement, Gilbert counts his work with the Desert Mission Food Bank for the Lincoln Foundation board as one of his most fulfilling assignments outside of his work with BYU.
“This is a place where people come for food,” he explains. “It is designed to help them overcome a short-term problem.” The food bank began in a small building it quickly outgrew, and Gilbert headed a $2.5 million capital campaign to help the organization meet the demand.
“I still remember the day when a divorced mother with three children came in with tears streaming down her face, saying her husband had left and she did not know how she could take care of her family. I immediately could see the need for the food bank. We now have a large warehouse and a large distribution faculty. All of us are volunteers, including dentists who donate one day a month to work on children’s teeth. We began the dentistry component after some schools approached us and said some children could not concentrate because their teeth hurt so much.”
Another volunteer position has kept Gilbert busy for 15 years as a member of the board of directors for the National Conference of Christians and Jews. He now serves as chair of the Arizona chapter.
“That group was formed when Al Smith, a Catholic, ran for U.S. president,” Gilbert explains. “A lot of religious prejudice emerged from that election, and the conference began to fight prejudice on a religious basis. Since then the goals have expanded to where we fight prejudice of any type–be it religion, race, sex, or prejudice against the economically disadvantaged. Among our many projects is going into schools to promote religious and racial tolerance. Last year we talked to more than 10,000 students in Arizona.
“We also sponsor a summer camp for high school students called ‘Any Town.’ When they arrive at the camp, we assign them a color–red, brown, or yellow–for a week and help them feel firsthand the effects of discrimination based on skin color. We also work on religious tolerance. Toward the end of the week’s camp, we show them ways to overcome prejudice and help them understand how prejudice starts and what they can do to right it.”
The conference has even defended the LDS faith, Gilbert says. “We did a considerable amount of good work with minimizing the effects of the anti-Mormon filmThe Godmakers. We distributed a lot of information against it, and the people who produced the movie were so mad, they sued us. We won the law suit.”
When not serving BYU and his community, Gilbert works as a law partner in the firm of Beus, Gilbert, and Devitt, which he helped found. Previously, he practiced law with former BYU President Rex E. Lee.
Law Firm Reaches Settlement in Bonneville Pacific Case
By Joe Costanzo, Deseret News Published: May 3, 1996
A $30 million settlement agreement has been reached with a Chicago law firm involved in the Bonneville Pacific Corp. bankruptcy case, bringing the total recovered to date to about $115 million.
The firm of Mayer, Brown & Platt has agreed to pay the $30 million by the end of June if the settlement is approved by the U.S. District and Bankruptcy courts in Salt Lake City, said trustee Roger G. Segal. A third of the settlement will likely go to a Phoenix law firm – Beus, Gilbert & Morrill – which handled the litigation on behalf of the trustee.
Meanwhile, Segal also announced that U.S. Bankruptcy Judge John H. Allen has approved an earlier, $65 million settlement agreement with the accounting firm of Deloitte & Touche over the objections of Portland General Holdings Inc. and plaintiffs in a related class-action lawsuit.
About a dozen defendants in the bankruptcy case have reached settlements with the trustee in advance of a pre-trial conference scheduled for May 6. Several have cited the prospect of protracted and expensive litigation as their motive for settlement.
However, Segal noted that numerous defendants remain, including Portland General Corp. and some of its officers; the law firms of Perkins Coie, Seattle, and Fraser & Beatty, Toronto; Ronald C. Yanke; Calpine Corp.; Piper Jaffray; Kidder Peabody; and Westinghouse Electric Corp. The case is expected to go to trial later this year.
A once high-flying electric energy firm, Bonneville Pacific declared Chapter 11 bankruptcy in 1992 in the wake of losses approaching $500 million. Two of its former officers, Carl T. Peterson and John T. Dunlop, received prison terms in connection with the company’s collapse.
Judge Orders Firm to Obey Subpoena
By Marianne Funk, Deseret News Published: May 1, 1993
Deloitte & Touche’s bid to keep certain documents from Bonneville Pacific’s trustee is causing the accounting firm embarrassment and costing a lot of money.
A federal judge chided company officials Friday for not obeying an October subpoena ordering the firm to turn over all documents relevant to the company’s audits of Bonneville Pacific.”By way of fatherly advice, I will merely observe that those who have been served with a subpoena would find it prudent – very prudent – to obey them,” U.S. District Judge Bruce Jenkins told Deloitte & Touche attorney Richard Casey.
U.S. Bankruptcy Judge John H. Allen already slapped the accounting firm with a $10,000 fine for not obeying a court order to turn the documents over.
“I think there has been a deliberate attempt by Deloitte & Touche and Deloitte & Touche’s counsel to circumvent the orders of this court,” Allen said when he fined the firm last week.
He again ordered Deloitte & Touche to promptly turn over the documents Bonneville Pacific has subpoenaed.
In addition, Allen told Deloitte & Touche it must pay Bonneville Pacific for the cost of fighting the matter in court.
“That will be several tens of thousands of dollars,” said Vernon Hopkinson, attorney for Bonneville Pacific trustee Roger Segal.
Deloitte & Touche asked Jenkins to stay Allen’s order to produce the documents but met with little sympathy.
“Frankly, I don’t know of any good reason to enter a stay. I’m going to deny your motion,” Jenkins told Casey.
Casey told Jenkins he is afraid Segal will sue Deloitte & Touche for its role in Bonneville Pacific’s alleged fraud. Several investors have accused Bonneville Pacific principals of manipulating the company into bankruptcy.
Segal has good reason to sue, said Leo Beus, attorney for Segal. Deloitte & Touche’s sloppy audits of Bonneville Pacific allowed Bonneville Pacific to deceptively raise $63 million from investors.
He outlined two deceptive transactions by Bonneville Pacific that helped the company show false profits. Thousands of investors bought stock in the company based on those false profits, he said.
The profits were crafted by funneling money to dummy companies owned by the same people who ran Bonneville Pacific, Beus told Jenkins.
But Deloitte & Touche approved the transactions without making any attempt to find out who really owned those companies, Beus said.
The named owners of a company run by former Bonneville Pacific officers allegedly bought a project from Bonneville Pacific for a $25 million, Beus told Jenkins. “In fact, all Bonneville Pacific received from that project was $1 million.”
Bonneville Pacific’s former officers crafted the deal to hide a $5 million annual loss, instead reporting a fake profit of $5.8 million that year.
Deloitte & Touche approved the fraudulent deal without even phoning someone at the company that supposedly paid the $25 million, he said.
Another transaction allowed Bonneville Pacific to show a false annual profit of $10 million instead of the company’s actual $5.3 million loss, Beus said.
“These are the earnings transactions that Deloitte & Touche looks at very hard each year,” he told Jenkins.
Segal wants all Deloitte & Touche documents – including procedure and training manuals – relating in any way to Bonneville Pacific.
Although Deloitte & Touche has turned over some documents, all of the relevant parts have been whited out, Beus said.
Casey urged Jenkins not to order them to turn over the information because Bonneville Pacific clearly wants to sue Deloitte & Touche.
“Mr. Beus is well noted for the success he’s had in suing accounting firms,” Casey said.
A $128.1 Million Settlement Reached In Miniscribe Case
By The New York Times Published: June 4, 1992
Former executives, accountants, and investment bankers involved with the Miniscribe Corporation, the defunct disk drive maker, have agreed to pay $128.1 million to settle fraud charges.
Greg Ruegsegger, the lawyer representing Miniscribe’s trustees, said Tuesday that he had reached an agreement in principle with more than 60 plaintiffs involved in the suits.
The settlement must be approved by a Federal judge in Denver and the United States bankruptcy judge overseeing Miniscribe’s liquidation.
In addition to Miniscribe management, defendants include the accounting firm Coopers & Lybrand, and the investment banking concern Hambrecht & Quist, among others.
They were accused of falsifying Miniscribe’s financial records and concealing the Longmont-based company’s sagging revenues throughout the late 1980s.
Miniscribe filed for protection from its creditors under Chapter 11 of the Federal Bankruptcy Code in January 1990. But the fraud allegations made it impossible to reorganize the company and the case was converted to a liquidation. Miniscribe’s assets were auctioned off to the Maxtor Corporation of San Jose, Calif.
“We’re hopeful we’ll get the settlement finalized and don’t expect any problems,” Mr. Ruegsegger said. “We think it’s a good settlement and a good deal for the estate.”
Plaintiffs including shareholders and creditors were seeking damages up to $1 billion. The company’s estate will pay off creditors in the bankruptcy proceedings as well as make cash settlements to shareholders.
The suit charged that former executives counted more than 6,000 contaminated disk drives as inventory and also packaged bricks as computer products and shipped them to distributors, recording sales of $4.3 million.
The settlement comes four months after a jury in Galveston, Tex. awarded $568 million to a group of investors and pension funds that put money into Miniscribe before the allegations arose. Coopers & Lybrand has agreed to pay up to $50 million to settle the Texas case; it is believed that Hambrecht & Quist will pay up to $24 million to settle the Denver case, according to a report in The Wall Street Journal. The investment firm already agreed to pay $30 million to settle the Texas case.
The paper said that to settle the Denver case, the defendants will pay a third of the settlement this year and the remainder over four years.