Minority investors in Oxbow Carbon, fresh off a major Delaware Court of Chancery victory, are now investigating up to $50 million in payments Oxbow made to founder and CEO William Koch's attorneys at Mintz, Levin, Cohn, Ferris, Glovsky and Popeo.

Robert J. Hurst and Barry Volpert, principles in Crestview-Oxbow Acquisition, said in a books-and-records complaint Wednesday that they were targeting ”corporate waste and inappropriate spending” on Mintz Levin, which had served Koch's interests despite signing on to represent Oxbow in a two-year suit over Crestview's right to force Oxbow's sale.

Last month, Vice Chancellor J. Travis Laster appointed a receiver to oversee an auction of the company, and he ordered Koch, the brother of billionaires and conservative political activists Charles and David Koch, to pay tens of millions of dollars in damages to Crestview and its affiliate Load Line for derailing a deal to sell the Oxbow in 2016.

In his ruling, Laster found that Koch had initially hired Mintz Levin to serve as his personal counsel, but later modified the firm's engagement letter so that Mintz Levin represented Oxbow.

“I personally believe Koch wanted Oxbow's counsel to be loyal to him, liked the idea that Mintz Levin would be in a position to run Oxbow's internal investigations into Koch's perceived adversaries, and understood that the minority members would effectively pay one-third of Mintz Levin's fees,” Laster wrote in an Aug. 1 decision.

Hurst and Volpert, who have served as Oxbow directors since Crestview first invested in the company back in 2007, said in their complaint that Koch had a history of using Oxbow as “his own personal ATM” and had even used company resources to fund at least some of the costs of a “lavish, celebratory post-trial vacation” for Mintz Levin attorneys at the Chatham Bars Inn on Cape Cod.

The purpose of their books-and-records suit, they said, was to identify any other alleged sources of corporate waste and to determine whether the Oxbow board had taken any steps to remedy potential breaches of fiduciary duty.

Hurst and Volpert said Koch's personal attorneys had admitted that Oxbow paid Mintz Levin more than $31 million over three years, while the firm was advancing Koch's personal interests. However, they alleged that Oxbow and lawyers for Koch refused to turn over any documentation supporting that figure. The actual cost, Crestview estimated, could be as much as $50 million, based on amounts reflected in Oxbow's financial statements for “certain items.”

“Plaintiffs are unable to determine the amount or justification for the company's spending on Mintz Levin or spending otherwise related to the exit sale litigation,” attorneys from Quinn Emanuel Urquhart & Sullivan wrote in the 21-page complaint.

“But whether the total amount of spending is $31 million or $50 million or more, the fact is that Mr. Koch chose to have Oxbow bear the costs of this spending rather than pay them himself. As a result, Crestview and Load Line 'indirectly bore one-third of the estimated' costs that Mr. Koch forced Oxbow to incur to litigate against Crestview and Load Line.”

Hurst and Volpert are represented by Michael B. Carlinsky, Chad Johnson, Jennifer Barrett and Silpa Maruri of Quinn Emanuel in New York.

An online docket-tracking service did not list counsel for Oxbow.

The case, captioned Crestview-Oxbow Acquisition v. Oxbow Carbon, has been assigned to Laster.