Simon Alleges Fiduciary Breach by Taubman

In an attempt to add further claims to their Michigan lawsuit against Taubman Centers, the Indianapolis-based Simon Property Group and Westfield America, the U.S. subsidiary of an Australian property trust, are alleging a "breach of fiduciary duties" by the Bloomfield Hills, Mich.-based Taubman.According to the two retail real estate investment trusts, which are engaging in an attempt to take over Taubman, the Taubman board has improperly used the Taubman Centers share repurchase program to increase "the relative voting power" of the Taubman family prior to an election of board members. Simon and Westfield said the Taubman board is further breaching its fiduciary duties to Taubman shareholders by appointing "its own handpicked director," Myron Ullman III, for a board seat left vacant by the resignation of Alfred Taubman in December 2001. (The Taubman patriarch was jailed after being linked to price-fixing activity at Sotheby's art auctions). Taubman is trying to ensure that the seat will not be up for election until 2005, improperly extending its three-year term into a six-year term, Simon and Westfield said. The action is invalid under Taubman's charter and by-laws and under Michigan law, the two REITs allege. Taubman had not returned calls seeking comment by MortgageWire's deadline.