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September 18, 2010

State treasurer hopeful says Mourdock misjudged Chrysler case

Buttigieg says Mourdock shouldn’t appear at event with Glenn Beck

NEW ALBANY — Democratic Party state treasurer candidate Pete Buttigieg criticized incumbent Republican Richard Mourdock on Friday for what he called a frivolous lawsuit against Chrysler Corp. that he said blew more than $2 million taxpayer dollars.

Buttigieg — who stopped by The Tribune office as part of a swing through Southern Indiana counties — conceded the 2009 lawsuit is not a new issue, but added the amount of money invested in the case “certainly came as news to me.”

Mourdock sued to stop the reorganization and sale of Chrysler LLC, to a group led by the Italian car maker Fiat. State pension funds and the Indiana Major Moves program were investors in Chrysler, as about $43 million in the company’s debt was purchased through the treasurer’s office in 2008.

A U.S. Bankruptcy Court judge ruled in favor of Chrysler, and the U.S. Supreme Court later rejected an appeal by Mourdock.

Buttigieg said it wasn’t a wise decision to invest in Chrysler’s junk bonds, and that spending $2 million on a New York law firm to fight the case was also a poor choice by Mourdock.

“It speaks to a larger concern — that taking care of our money is not the priority in that office anymore,” he said.

The lawsuit was not winnable and diverting retirement funds for “partisan adventures” was a costly move to try and recover the $6 million Mourdock lost in the Chrysler investment, Buttigieg said.

As part of the Supreme Court case, the state argued the use of federal Troubled Asset Relief Program, or TARP, funds for auto bailouts was unconstitutional. That was in addition to Mourdock’s belief the deal between Fiat and Chrysler violated bankruptcy laws.

In a phone interview Friday, Mourdock said he had no choice but to fight to recover the pension investments.

He said he’s amazed Buttigieg continues to question the lawsuit and the $2 million spent fighting the case that was supported by the state pension holders but “is OK with the fact tens of billions of dollars were spent to bailout companies the people were totally against.”

Mourdock said the specifics of the case required the state — with the approval of the Indiana attorney general — to hire the New York law agency.

“We had to have a firm that had knowledge in the case, and there was but one choice to use,” he said.

Buttigieg also criticized Mourdock for agreeing to appear at a speaking engagement today in Angola with television and radio personality Glenn Beck. It’s part of an event organized by the group We The People, according to the group’s website

Buttigieg said Beck’s role as a paid spokesman for Goldline has come into question, as there have been accusations the company has misled investors and pushed people to sell their gold due to pending “socialist takeovers.”

Buttigieg said the state treasurer should be the last Indiana government official appearing with Beck.

Mourdock responded that people are not being scared by Beck, but “are made fearful by the Obama policies that Buttigieg” endorses. He added he has never met Beck, but was a guest on his radio show when the Chrysler lawsuit was taking place.

“It was obvious [Beck] had done his homework about that case,” he said.

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