Wednesday, March 6, 2013
Alum Sues For Return of $7.5 Million Donation, Says Georgetown Law Reneged on Agreement to Name Fitness Center After Him Following Insider Trading Conviction
Scott K. Ginsburg made most of his many millions in the late 1990s, when he and Tom Hicks (briefly) partnered in the radio business and sold their offspring to Clear Channel for upwards of $17 billion. ... [L]ike many wealthy men, Ginsburg needed more to show off than just his money. As he told the Dallas Observer in 1999, “Let me suggest that I don’t have a small ego.”
Which is why he was only too happy to donate $5 million to the Georgetown University Law Center in March 2000: The money would go toward the construction of a new fitness center to be branded the Scott K. Ginsburg Health and Fitness Center. His name would be on the side in big bold letters; his picture would be displayed inside. Agreements were signed; press releases, issued.
But 12 years, millions more in donations and one insider-trading judgment later, and still Ginsburg’s name is nowhere to be found on campus (or on the school’s website, for that matter). And now he wants his money returned: On Monday Ginsburg sued the university in Dallas federal court, and he hopes to recover “at least $7.5 million as the full amount of Georgetown’s unjust enrichment.” ...
On September 9, 1999, the Securities and Exchange Commission accused Ginsburg of leaking inside information to his father and brother. A jury later ordered him to pay $1 million. The trial judge set aside the verdict, but the Securities and Exchange Commission appealed and won. The case would eventually find its way into legal textbooks.
After the jury ruled for the SEC, says the suit, Georgetown got cold feet. According to an exhibit filed with the lawsuit, on May 2, 2002, then-Georgetown Law Center Dean Judith Areen sent Ginsburg a letter thanking him for his “support,” “generosity” and “steadfast loyalty.” She also wanted to redo the agreement, removing the promise of naming rights from the deal … at least until the whole SEC thing blew over. Said the missive, Areen wanted to figure out some some way to “honor [Ginsburg's] gift without generating negative media coverage.” She said they’d revisit the deal “if the jury verdict is overturned.” But Ginsburg says he balked at the revised agreement, and that it was never signed.
(Hat Tip: Inside Higher Ed.)
- ABA Journal, Law School Donor Wants His $7.5M Back; Suit Claims Georgetown Reneged on Naming Rights
- ABC News, 5 Donor Flaps: They Gave to Colleges, They Regretted
- Chronicle of Philanthropy, Georgetown U. Donor Sues to Recoup $7.5-Million in Gifts
- JD Journal, Georgetown University Sued by Donor Scott K. Ginsburg
- National Law Journal, Alum Says Georgetown Law Reneged on Naming Agreement