Hilton Executor Criticizes State Suit

James Bates, executor of the Conrad Hilton estate, charged Tuesday that a suit by the California attorney general is aimed at pressuring him to sell a controlling block of Hilton Hotels stock to Golden Nugget.

In papers filed for a crucial court hearing today, Bates and Hilton Hotels alleged that Golden Nugget lawyers “instigated” a petition by Atty. Gen. John Van de Kamp last week that asks the Los Angeles County Superior Court to bar Bates from voting the estate’s 27.4% holding for Hilton Hotels management’s anti-takeover proposals at the firm’s May 6 annual meeting.

Bates’ opposition papers said the attorney general’s petition “was instigated by Milton A. Rudin and other counsel for Las Vegas casino proprietor Golden Nugget Inc., which is reportedly seeking to obtain control of Hilton Hotels” by causing Bates to sell the 27.4% holding.

The executor said he will ask at the hearing that the attorney general’s office “reveal in full to the court the extent of the communications, urgings and participation by counsel and persons representing Golden Nugget with regard to the petition.”

Hilton Hotels, filing a request to appear at the hearing as a “friend of the court,” also told the court that the company “is informed that the attorney general’s petition was filed at the specific instance of one Milton A. (Mickey) Rudin.”

The Hilton Hotels filing went on to say that Rudin, who is a well-known entertainment industry lawyer, has met with the attorney general’s office on behalf of Golden Nugget, and that Golden Nugget attorneys “have been working hand in glove with the attorney general in preparing and filing the attorney general’s petition.”

James Cordi, the deputy attorney general who filed the petition, said Tuesday, “I did meet with those people” to consider their ideas, as well as with counsel for Bates, the foundation and Hilton.

“I do not represent the Golden Nugget or work with their interest,” Cordi said. “It may be their interest coincides with the interest of public and charity.”

‘Two-Pronged Assault’

Hilton Hotels’ court papers also charged that Golden Nugget “has orchestrated a two-pronged assault in its effort to impede the Hilton Hotels stockholder’s meeting.” The papers also drew attention to a Golden Nugget injunction suit, which is set for a Thursday hearing in U.S. District Court, alleging that it was “clearly intended” to force a postponement of the annual meeting.

Bates alleged that the attorney general’s petition attacked his integrity and said that he, not the attorney general, has “taken the lead in seeking to protect the interests of charity in this estate.”

Cordi said Tuesday that he has “the highest respect for Mr. Bates’ integrity” and did not intend to impugn it.

The estate’s chief beneficiary under Conrad Hilton’s will is a charitable trust, the Conrad Hilton Foundation. The Hilton stock was willed to the Conrad Hilton Foundation. However, Barron Hilton, the founder’s son and Hilton Hotels’ chief executive, is pressing his claim to a right to buy the 6.8 shares for $24 each. The current market price is about $68 each. Golden Nugget’s bid of $72 was rejected last month by Bates.

Bates denied the attorney general’s allegation that he has a conflict of interest between his positions as executor of the estate and as a Hilton Hotels director.