USC Benefactor Sues Over Gift
After watching his beloved grandfather succumb to cancer more than 50 years ago, Paul F. Glenn promised himself that if he ever became wealthy, he would donate generously to medical research.
Glenn, now 71 and head of a venture capital firm in Santa Barbara, went on to earn a fortune as a commodities speculator. And, true to his pledge, he gave USC $1.6 million in the mid-1990s to promote medical research on aging.
But that touching story hasn’t had a fairy-tale ending.
Instead, it has turned into a nasty lawsuit, with Glenn saying that USC is defying his wishes, concealing how it is using his money and hurting his reputation.
The legal skirmish sheds light on the conflicts, usually behind-the-scenes, that occasionally arise between universities and disenchanted donors. It also puts a spotlight on Glenn, a Harvard Law School graduate and health buff who has filed at least a half dozen unrelated lawsuits around the country over the last several years.
University officials, citing a standing policy, will not comment on the pending litigation, except to say that USC and Edward L. Schneider, dean of the school’s Andrus Gerontology Center, “vigorously dispute” Glenn’s allegations.
Glenn, who tries to keep himself healthy by taking 30 nutritional supplements each morning and evening, said the aim of his donation to USC was in keeping with the stated mission of his 37-year-old Glenn Foundation for Medical Research. That is “to extend the healthy productive years of life through research on the mechanisms of biological aging.”
According to Glenn, USC initially appeared to be living up to its end of the bargain. As Glenn stipulated, a young outside researcher investigating the biology of aging soon was hired for the Paul F. Glenn Foundation Chair in Cellular and Molecular Gerontology. It was to be a rotating three-year position.
Glenn said his aim was to propel the careers of promising young biomedical researchers who otherwise wouldn’t have support.
Eventually, however, Glenn said he learned that the first two professors appointed to the endowed position were not given the income from his $1.6-million endowment to cover their research expenses. He called that a “great mystery” that remains unsolved.
The first holder of the chair, Pamela Larsen, confirmed that she never received income from the endowment. Larsen, now a research chemist at UCLA, said she left USC in 1999 over that issue and other problems.
But Julie K. Andersen, who was the second person to hold the Glenn chair, said she was “well-supported” and that she believed her funding came from the Glenn endowment.
Glenn said he was surprised he could not get an explanation from Schneider, whom he had known for years and who he says pursued him for the donation.
“I never dreamed of him double-crossing me, and I don’t know why he did it,” Glenn said.
Later, Glenn said, the current holder of the chair, Valter D. Longo, was named even though Glenn objected because Longo already was on the USC faculty.
“It looked to us like a backdoor way of just using our funds to hype the budgets of people already on the faculty, and that’s not what was intended,” Glenn said.
Glenn likened his situation to an ongoing legal flap at Princeton, where he earned his undergraduate degree in 1952.
Princeton is being sued by relatives of a couple who in the 1960s set up a foundation to fund the Woodrow Wilson School of Public and International Affairs. They accuse the university of mishandling the foundation’s nearly $600 million in assets.
“The larger issue is that the intent of the donor in the long run becomes eclipsed in favor of the political purposes at the university,” Glenn said.
Princeton spokeswoman Lauren Robinson-Brown said the university believes the funds have been managed properly.
Sheldon E. Steinbach, general counsel for the American Council on Education, said such legal action remains rare but that donor suits and threatened suits appear to have increased slightly in recent years. He attributes that to the country’s growing litigiousness in general.
Steinbach said universities try to resolve disputes quietly to avoid controversies that could alienate other potential donors. “It’s unusual when they reach the public arena,” Steinbach said.
One way of doing that is to simply return a donor’s money.
In fact, Yale University did just that in 1995. It returned a $20-million donation from Lee Bass, apparently because the Texas businessman wanted veto authority over faculty members who would teach the new Western civilization courses that his money was intended to fund.
Although Glenn’s has become a public squabble, the financial stakes are modest by the standards of a school like USC. The university has received four donations of about $100 million each over the past decade.
The suit is by no means Glenn’s first foray into the courtroom. Court records in Los Angeles, Santa Barbara, Arizona, Pennsylvania and Illinois show Glenn as a plaintiff in several recent lawsuits.
Glenn says his suits are attempts to collect debts and recoup losses from former business partners and commodities brokers who have cheated him.
“I’ve been too trusting,” Glenn said. “If I liked the cut of a guy’s jib, and he had an idea that sounded reasonable, I would back him. Why do they steal the money? Because they can. They’re looking for people who trust them.”
Some targets of Glenn’s lawsuits, however, describe him as mercurial and quick to litigate. Robert R. Horton, chairman and chief executive of Alchemix Corp., an Arizona company specializing in low-polluting energy technologies, said he was sued by Glenn after a $40-million clean-coal venture in Pennsylvania failed. The case is scheduled to go to trial next month.
“If things don’t work out as well as they might, he becomes litigious,” Horton said.
“I would say that our experience was that we saw him as an angel in our venture and when we were unable to make it work, we found that [he] wasn’t all angelic.”
Glenn said the coal venture with Horton turned out to be “a clear case of fraud.”
One of Glenn’s oldest friends, Daniel L. Ritchie, chancellor of the University of Denver, called him a philanthropist with exacting standards. “He doesn’t throw money away,” said Ritchie, who noted that his university has not received any donations from Glenn and that he doesn’t anticipate any.
“He is a very scrupulously honest person who expects the same of other folks,” added Ritchie, who used Glenn as his commodities broker in the late 1950s. “When they don’t live up to that, he probably feels that he has an obligation to do his part to encourage them to do the right thing.”
No trial date has been set for Glenn’s case against USC, which, in addition to seeking damages, seeks to force the university to transfer the donation to another research institution.
For now, researchers involved remain undeterred. Longo, the current holder of the Glenn chair and an assistant professor at USC, said university officials “haven’t told me anything” about the dispute other than that a lawsuit was filed. Longo led a research team that discovered how the chief molecular villain of Alzheimer’s disease kills nerve cells, and it identified two drugs that combat the process.
“Thanks to the Glenn Foundation, we’ve published some important research,” Longo said.
