August 22, 1997
After months and months of unbelievably expensive legal maneuvering by both sides of the Carto/IHR battle, a Texas judge has granted a motion for summary judgment in favor of the LSF (parent corporation of the IHR) in a case brought by Willis Carto. Carto, the Judge ruled, had no legal right to bring the suit in the first place.
The case arose out of Carto’s contention that he had secretly “bought” the non-profit LSF back in 1966, or alternately, that he had been appointed “permanent substitute incorporator,” a fictitious designation unknown in law.
On the basis of this false status, Carto had asked to Texas court to rule that he could do whatever he wanted with the LSF/IHR, including (but not limited to) appointing directors. Had Carto been granted the power to appoint directors, he could have hand picked a board that in turn could have excused him for his role in the disappearance of more than $7 million meant for the LSF/IHR.
Carto’s desperation in avoiding accountability for the disappearance of this money can be seen in the fact that he brought this suit in September 1994 after losing the critical Polis decision in December 1993 (and the subsequent appeal in April 1994), and after the LSF/IHR in July 1994 had filed suit against him and his cohorts to recover the missing funds. The Texas case was clearly an attempt to “end run” around the decisions of three separate California courts, each of which has ruled that Carto’s actions were either improper or illegal.
For years, Carto has been telling everyone that he was going to win in Texas, and that the win would exonerate him and his cronies. The fact that he has lost demonstrates once again the propriety of the actions of the IHR staff in severing relations with Carto in September 1993.
Carto still has the opportunity to appeal the decision, but with any luck, this case, which has cost the IHR an average of thousands of dollars a month for nearly three years, and which certainly must have cost Carto much, much more, is finally drawing to a close. No matter what happens in the future, any thoughtful person must wonder where Carto is getting the money for all these expensive legal battles.