Hammer Plan Challenged by Shareholders

Attorneys for shareholders challenging Occidental Petroleum Corp.’s financing of a museum to house Armand Hammer’s art collection have filed a court notice seeking sworn information on whose money will be used to buy back a collection of paintings Hammer gave USC25 years ago.

The filing, in Delaware Chancery Court in Wilmington, was made public Tuesday. It came a day after The Times reported that Hammer, Occidental Petroleum’s chairman, had made an offer to repurchase an Old Master art collection he donated to USC’s Fisher Gallery in 1965.

The filing seeks to take a sworn statement from Hillary Gibson, a close Hammer associate who is the top administrator of the Armand Hammer Museum of Art and Cultural Center. The museum is under construction in Westwood on a site that adjoins Occidental Petroleum’s headquarters.

Occidental had no immediate comment on the new court development.

Hammer has offered to repurchase the USC art collection in the most recent development in a dispute between Hammer and the university in which Hammer has not honored USC requests that he return a Rubens masterpiece he borrowed back to hang in his office after making the gift. No precise estimate of the total value of the USC collection has been made, but art experts suggested its two Rubens works might have a combined value of as much as $30 million.

The focus by attorneys for dissident shareholders on the source of funds Hammer might use to repurchase his art collection apparently grew out of a revelation by Hammer in a deposition last summer that Occidental--and not Hammer personally--had provided $5.8 million to purchase a set of Leonardo da Vinci sketches a decade ago.

The Leonardo collection, which was renamed the Codex Hammer, was described at the time of its purchase in 1980 as having been bought by Hammer through his personal foundation. In a sworn statement in June, however, Hammer conceded that the Codex purchase was financed by an unpublicized special appropriation by Occidental Petroleum’s board of directors. None of Hammer’s personal funds were used.

The new Delaware court filing was made by attorneys representing New York investor Alan R. Kahn, who first challenged Occidental’s financing of the Armand Hammer Museum of Art and Cultural Center. But Susan Henrichsen, a deputy California attorney general who represents the California Public Employees Retirement System, is awaiting a ruling on its petition to enter the case as a plaintiff.