Stillwater News Press

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March 19, 2013

UPDATE: Appeals court rules Oklahoma State must pay ‘Gift’ premiums

STILLWATER, Okla. — The Fifth U.S. Circuit Court of Appeals in New Orleans affirmed a decision to deny Cowboy Athletics and Oklahoma State University booster T. Boone Pickens compensation for $33 million spent on a fundraising campaign.

U.S. District Judge Jorge A. Solis in Dallas ruled against Cowboy Athletics last year. The circuit judges affirmed his decision.

The “Gift of a Lifetime” program involved taking out $10 million life insurance policies on 27 aging school supporters with the university as the beneficiary. The school planned to raise millions by betting supporters would die earlier than actuarial tables predicted. After two years none of the supporters had died and Cowboy Athletics canceled the policies.

Pickens and Oklahoma State University’s athletic fundraising foundation filed the Payne County lawsuit in 2010, alleging agents for Lincoln National Life Insurance Company used manipulated data and inflated the benefits of the life insurance strategy.

The district court dismissed all of Cowboy Athletics’ claims on summary judgment.

The circuit judges’ opinion stated they found no evidence of fraud by Lincoln and the university had been warned about the risks of the deal.

“This was not the Cowboy’s first rodeo,” the circuit judges wrote.

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