By KATE BRUMBACK | Associated Press
ATLANTA (AP) — After working decades to build a wildly successful firearms company, Gaston Glock conspired with associates to push out his ex-wife and business partner of almost 50 years and steal millions of dollars she was entitled to, according to a lawsuit filed Thursday in federal court in Atlanta.
They participated in a worldwide racketeering scheme over decades aimed at taking money from Helga Glock, who was divorced from her husband in 2011, through various criminal methods, including improper royalty payments, laundering money through fraudulent billing companies, and sham lease and loan agreements, the lawsuit claims.
A woman who answered the phone Thursday in the media relations department at Glock Inc., the company's U.S. headquarters, referred questions to the company's lawyer but then hung up before giving a name or contact number. She did not answer when called back and did not immediately respond to a voice message.
Several lawyers who have previously represented Glock Inc. in legal disputes did not immediately respond to emails seeking comment.
The lawsuit details what it claims are the exploits of a man who regularly engaged in unscrupulous business practices and kept a stash of “fun money” used to “cavort with women around the world,” going so far as to buy homes for some mistresses in the Atlanta area.
Glock's actions toward his family “resemble the senseless and self-destructive rage of Shakespeare's King Lear, when he foolishly mistreats a loyal but candid daughter, Cordelia, in favor of cunning and ruthless flatterers,” the lawsuit says. “Perhaps neither pathology nor psychology can provide a satisfactory explanation for why an aging billionaire would spend his twilight years seeking to terrorize members of his own family.”
Other defendants include companies owned by Glock around the world and several former Glock executives.
Helga Glock's lawsuit asks for a jury trial and seeks potential total damages of approximately $500 million, as well as attorney fees. She also asks a judge to remove Gaston Glock and others from their roles in the company, reorganize the companies owned by Glock and restore a larger ownership interest for Helga Glock.
Helga and Gaston Glock met in 1958 and married in 1962. They started a company in 1963 that eventually became a gun manufacturer called Glock Ges.m.b.H. in 1983, according to the lawsuit. Gaston Glock established a U.S. subsidiary of the company in Smyrna, just outside Atlanta, in 1985.
Glock's pistols quickly became popular among law enforcement officers and civilians alike, and the U.S. subsidiary became a main economic engine for the company, the lawsuit says.
Gaston Glock and his associates had complete disregard for any form of corporate structure and set up a network of sham companies in locations that included Bermuda, Curacao, Hong Kong, Ireland, Liberia, Luxembourg and Panama, the lawsuit says. They transferred money out of Glock Inc., and into shell companies he owned or controlled to hide the origins of the money, the lawsuit says.
Gaston Glock avoided questions from his wife and business partner using intimidation and demanding trust, telling her it would be better if she wasn't involved in their finances, the lawsuit says. She trusted and relied on him.
“While Glock Sr. had been promising his wife that all of his efforts were directed at building up the Company, and preserving it for the family's future, he and his associates had instead been systematically stealing from, and laundering the proceeds through separately-owned business entities and bank accounts,” the lawsuit says.
Until 1999, Gaston Glock owned 85 percent of the shares of the Austrian parent company and Helga Glock owned 15 percent.
Gaston Glock and his associates created foundations and convinced Helga Glock and their children to contribute their assets and waive inheritance rights, ostensibly to benefit them and protect the family's control of the company, the lawsuit says. Helga Glock was left with a 1 percent interest in the company, and Gaston Glock had complete control of the trusts, the lawsuit says.
After they divorced, Gaston Glock removed his wife and three adult children as beneficiaries of the foundations and said they and their descendants could not have any further association with the company, the lawsuit says. Shortly after the divorce, Gaston Glock married a woman roughly 50 years his junior.
Thursday's lawsuit is not the first time Helga Glock has turned to this U.S. federal court in a dispute with her ex-husband. In March 2013, she asked the court to help her get financial records for Glock's American companies so she could use them in the couple's divorce proceedings in Austria to establish marital assets and the amount he should pay her in support. The judge in that case granted her request for subpoenas.
Lawyers for the company have responded in court filings that there's no basis for the federal court to compel the company's U.S. entities to turn over the financial documents because Helga Glock can't use any of them in the Austrian proceedings.