A year later the wind seems to have swung around. Koch's second boat, Defiant, launched last July, surpassed Jayhawk. His third, America�, soundly whipped Conner's Stars & Stripes in the second and third rounds of the Defender Selection Series, which began in January. In desperation, Team Dennis Conner took saws and sandpaper to Stars & Stripes, opening up the transom and shaving the mast to gain speed—the sailing equivalent of tossing all the passengers' luggage out of an airplane to maintain altitude.
These adjustments and his formidable sailing skills have kept Conner in the game, but just barely. Over the weekend, Koch's America� clinched a slot in the defender finals by outracing Stars & Stripes and Kama ( Koch's newest boat, launched in March) in consecutive races. That left Conner, a three-time America's Cup champion, in the embarrassing position of having to win Monday afternoon's tiebreaker with Kanza just to get to the best-of-13 finals, which begin April 18. Conner did win, but unless he has been holding his face cards till the end—an unlikely premise, given his brush with elimination—it is just possible that Bill Koch, the most intriguing figure in yacht racing since Ted Turner won the America's Cup with Courageous in 1977, will defend the Cup next month.
Win or lose, Koch will have paid an extraordinary price—$55 million at last count, much of it his own money. The America� syndicate has 150 people on its payroll—sailors, coaches, office workers, janitors, security guards, marketing specialists, scientists, spies, computer whizzes, 'it's horrendous." Koch says, looking a little dazed. "If I'd known how much it would cost and how much effort it would take, I wouldn't have done it. But once you mount a tiger, how do you get off?"
In Wichita they wonder who really has the claws. While Koch was busy sailing last month, the people at Koch Industries were fuming over the private detective they caught going through the garbage of attorneys working on the various Koch lawsuits. Koch Industries obtained a restraining order against Bill, which was lifted after he admitted he had hired the detective.
"Billy is obsessive, unstable," says Donald Cordes, executive vice-president for legal and corporate affairs at Koch Industries. "He has done some pretty horrendous things to Koch Industries. He treats these legal battles with his brothers like a competition, the way other brothers might look at a game of H-O-R-S-E in the backyard."
George Ablah, a prominent Wichita businessman and longtime friend of the Koch family, agrees. "I think it's all a onesided vendetta," he says. "Billy is a kind of troublemaker, and he has a problem with not being the boss."
If the sniping sounds petty, the stakes are not. Koch Industries is the second-largest privately held company in the U.S., a diversified oil giant with 12,000 employees and $16 billion a year in revenues. Reclusive Fred R. Koch, 58, the oldest brother, lives mostly in Monte Carlo and London and spends a reported $20 million a year on his art collection. Charles Koch, 56, is CEO of Koch Industries and lives in Wichita. David Koch, Bill's twin and an executive vice-president of Koch Industries, lives in New York City and entertains in St. Tropez. For one party, the handsome bachelor chartered a 163-foot yacht that once belonged to a Saudi prince, saying, with eerie prescience, "It's incredible how a boat can attract people."
As a study in wealth accumulation, the Koch family saga is almost without peer. Fred C. Koch, the son of a small-town Texas newspaper publisher, started out in the 1920s with $200 and a chemical engineering degree from MIT. His breakthrough idea: a thermal cracking process to increase the gasoline yield of crude oil. In the late '20s he took his technology to the Soviet Union, where he built 15 refineries under the first of Stalin's five-year plans. From 1945 to 1952 Koch was locked in restraint-of-trade litigation against many of the major U.S. oil companies, which had been filing patent-infringement suits against independent oil producers using the Koch process. Koch finally received a $1.5 million settlement.
"Fred Koch, the father, was a real John Wayne type," says Sterling Varner, a former president of Koch Industries. Stern and usually undemonstrative, the elder Koch was away from home for months at a time, but he made sure his four sons were shielded from what he called "country-club attitudes." The Koch boys worked summers at the family ranch in western Kansas. They were taught to ride horses, hunt and fish like "real men." They accompanied their father on safaris in Africa and polar-bear hunts in the Arctic Circle. "The old man didn't put up with any——," says Varner. "He was papa, and that was that."
Over time, Fred Koch's rugged individualism took on a cranky, paranoid edge. Enraged by the liquidation of some of his Russian business colleagues in the purges of the '30s, the oil magnate became a fervent Communist-baiter, a member of the first advisory board to the John Birch Society. In a broadside titled A Business Man Looks at Communism, published in 1960, Koch accused the Reds of plotting a U.S. "race war," attacked labor unions, denounced the U.S. Supreme Court for "pro-Communist decisions" and condemned modern art because of its association with Picasso, "an admitted Communist."