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USA Golden Temple Deal Opposed


1947-2014 (Archived)
Jun 17, 2004
Golden Temple deal opposed
Sikh religious leaders aren’t on board with the proposed settlement of a long-running lawsuit


Four of the six Golden Temple managers accused by the state of wrongdoing in a long, messy lawsuit in Multnomah County Circuit Court want to settle.

So does state Attorney General John Kroger, who sued the managers of the Eugene natural foods company a year ago in his role as supervisor of Oregon charities. So does Unto Infinity, the four-member board of business leaders which, following the death of Sikh leader Yogi Bhajan in 2004, was charged with overseeing Golden Temple and the Sikh community’s other businesses, as well as its large network of religious and yoga nonprofit organizations.

But the Sikh religious leaders, whose lawsuit against Golden Temple managers was merged with the state’s in December 2010, are not on board with the proposed settlement.

Their attorney, John McGrory, said in an e-mail to the court that the proposed settlement would “directly impact the relief my clients are requesting from the court.”

“We believe that in ruling on potential objections to the settlement the court will be preemptively ruling on issues that are to be decided in the trial,” the e-mail said.

He asked Judge Leslie Roberts to schedule a hearing on the proposed settlement after she issues her ruling on the ongoing lawsuit.

Judge Roberts has not yet scheduled a hearing on the proposed settlement. Unto Infinity’s lawyers filed a joint motion for approval of a settlement agreement earlier this week.

If the settlement is approved, it would shift a big portion of ownership and control in Golden Temple from the four Golden Temple executives back to Unto Infinity, the four-member board that oversees the Sikh community’s businesses.

Unto Infinity would pay the four executives a total of $156,000 for their ownership interest, which would give Unto Infinity a majority stake in the company, boosting its ownership from 10 percent to 56.8 percent, according to court filings.

The four executives would pay $104,000 to Unto Infinity and $40,000 to the state, according to the motion.

The state in turn would drop its claims against the four Golden Temple executives, and Unto Infinity would offer them some protections against possible future legal disputes and costs.

The settlement also would smooth the way for the next stage for Golden Temple of Oregon, which started out as a tiny bakery founded by Yogi Bhajan’s adherents in Eugene and evolved into an international concern with $125 million in annual revenues.

The settlement would ensure “an orderly transition of management during a time of monumental changes at Golden Temple,” the motion said.

For decades, Golden Temple, with its thriving cereal and tea business, was a cornerstone of Lane County’s natural food industry. The company sold its cereal division to Hearthside Food Solutions of Illinois for $71 million in May 2010. Golden Temple still owns and operates the Yogi Tea division, which has about 50 employees in Springfield and about 100 in Europe.

This summer arbitrators in Portland ruled that the trademark rights for Yogi Tea belong to Yogi Bhajan’s heirs, including his wife Bibiji. Golden Temple must discontinue using the Yogi brand as of Jan. 1, and is in the midst of rebranding its tea line — a costly and risky endeavor, marketing specialists say.

Under the proposed settlement with the state, the four Golden Temple executives, including CFO Karam Singh Khalsa, COO Ajeet Singh Khalsa, sales manager Gurudhan Singh Khalsa and R&D director Guru Hari Singh Khalsa, would stay on at the company until the end of the year with the same salary, compensation and bonus plan as before. When they leave their jobs, they would be bound by an agreement not to compete with their former employer in the tea business until June 30, 2014.

Attorney Michael Farnell, who represents these four Golden Temple managers, provided The Register-Guard with this statement from his clients:

“Some of us felt that our ownership interest was creating too much of a distraction and too much litigation for us personally. Other owners have a different view and that’s their prerogative. We each respect the views and approaches of the other.”

“We hope that by entering into this settlement agreement and conveying our equity interests to Unto Infinity LLC, we can put all of this distraction behind us, and continue to focus all of our energies on selling tea for as long as the business will have us.”

Hammering out a settlement agreement took two months, Unto Infinity attorney Thomas Johnson said.

“UI feels like it negotiated a good deal for the nonprofit,” he said. “They’re confident the deal is in the best interest of the organization.”

Tony Green, spokesman for Attorney General Kroger, said “the settlement is consistent with the goal of returning assets to the charity for its benefit.”

The two Golden Temple managers who are not part of the proposed settlement are CEO Kartar Singh Khalsa and marketing director Robert Ziehl.

Their attorney, Irving Potter, said the parties agreed to restrict their comments to what was available in the public record. He declined to comment on why his clients did not join the other four Golden Temple Managers in the proposed settlement agreement.


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