ICN Proxy-Battle Figure Sues New York Times

Rafi M. Khan, the disgruntled shareholder who is trying to oust the board of ICN Pharmaceuticals Inc. and its chairman, Milan Panic, filed a $210-million libel suit Monday against the New York Times.

In the suit, filed in the Supreme Court of the State of New York, Khan alleges that the newspaper has run a series of erroneous articles beginning in October, when Khan and ICN officials were in the heat of a proxy battle. That battle is expected to reach a conclusion on Feb. 1, when the Costa Mesa pharmaceuticals company holds its annual meeting.

Khan alleges in his suit that New York Times business writer Susan Antilla wrote “maliciously libelous” statements about him. Among other things, Antilla’s stories said that Khan was fined for stock fraud in Canada in 1974, was sued by the Securities and Exchange Commission and did special favors for clients.

Khan denies all of those statements, calling them baseless.

New York Times Executive Editor Sally Hoffmeister, also named in the suit, would not comment Monday, referring inquiries to the newspaper’s public relations office. That office did not return phone calls seeking comment.

Khan, a stockbroker who once touted ICN shares, has been trying since March to unseat Panic, who is a former prime minister of Yugoslavia. Khan alleges that Panic and the rest of the company’s top management are not in tune with shareholders.

ICN officials, however, say that Khan is a stock promoter with a shady reputation. The company successfully forced Khan into a hearing on whether he was a fugitive from Scotland Yard. A New York judge has asked federal authorities to investigate Khan to find out if he lied on the stand or is fleeing British law.

That investigation is ongoing.