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Reported Ruling Thwarts Broker's Attempt to Oust ICN Chief Panic : Courts: Sources say judge extended ban on Rafi Khan's proxy bid to take control of the Costa Mesa drug maker. Current board appears safe for now.

May 14, 1993|JAMES M. GOMEZ | TIMES STAFF WRITER

COSTA MESA — A federal judge in New York has apparently issued a ruling that bars a Beverly Hills stockbroker from soliciting proxies in an effort to oust Milan Panic as chairman of ICN Pharmaceuticals Inc., sources said Thursday.

Rafi Khan at the brokerage Reynolds Kendrick & Stratton has been under a temporary restraining order to stop building a coalition of disgruntled shareholders in his attempt to place his own handpicked board of directors in control of the Costa Mesa company. According to one of Kahn's colleagues and others familiar with the case, U.S. District Judge John Sprizzo decided late Thursday to extend the ban by invoking a preliminary injunction against Khan.

"I understand that the judge ruled in favor of ICN," said broker Burke Trafton, who also works for Reynolds Kendrick & Stratton. "It's not surprising. From day one, that judge has been biased."

Khan was traveling from New York to Los Angeles Thursday afternoon and was unavailable for comment. He apparently was not immediately aware of Sprizzo's ruling.

Meanwhile, others involved in the case were unusually silent about the ruling, which had been expected for more than a week. Khan's New York attorneys would not comment on the case.

ICN officials were also silent. "We won't comment," spokesman Jack Sholl said, adding that the company expects to "make a full and complete statement" today.

A victory for ICN presumably means that the company could now set a new date for its annual meeting, initially set for May 12 but then postponed indefinitely. ICN blamed the postponement on a gag order that accompanied the temporary restraining order.

"How can we talk at the meeting at all if we are not allowed by the court?" Panic said on Tuesday. During an hourlong interview, he seemed confident about the pending court decision, referring to Khan as "Mickey Mouse" despite the gag order preventing him from commenting.

An ICN victory would cast doubts on the ability of Khan to overthrow ICN's power structure. In a lawsuit, Khan and other shareholders have accused Panic of drawing lavish salaries and violating a State Department agreement to not do business for ICN while he was serving as prime minister of Yugoslavia last year.

ICN, in a separate suit, has accused Khan of using inside information to launch his proxy battle against Panic.

No court date has been set for either case.

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