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Coca-Cola May Owe $130M to Owners of Century-Old Stock Certificate

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You may want to think twice before deciding to wholesale scrap all the junk in your dead grandfather’s attic. Some of it could be worth something. In fact, a dusty box of antique documents, purchased for a few bucks at an estate sale, could end up becoming one of the greatest financial trades ever.

Deceased treasure hunter Tony Marohn thought he’d hit the auction house lottery in 2008 when he purchased a stock certificate, issued in 1917, for 1,625 shares of long-defunct California oil company Palmer Union. Though the certificate was signed by a John Wagner, the line to reissue it was blank so Marohn added his name as the transferee.

“It was like a blank check,” said Chris Morosoff, the attorney for Marohn’s estate. “When Tony bought the box, he bought this stock certificate. Whoever holds it, whoever puts their name on it, owns it.”

Tracing Palmer Union Oil’s history, Marohn discovered a lineage of ownership and acquisitions by similarly forgotten businesses but that led eventually to the very active and profitable Coca-Cola Company (KO). In the mind of Marohn and the relatives by whom he is survived, those 1,625 shares of Palmer Union Oil stock should legally translate into 1.8 million shares in the soft-drink giant for an estimated value of $130 million.

In 2009, Coca-Cola denied a request by Marohn for the stock and even sued him, seeking a declaration stating he wasn’t entitled to it. The company said his claim was “meritless and unfair to the company’s millions of legitimate shareholders.”

But Marohn battled Coke for the stock and continued to do so until his death from heart failure, a year later. His family has picked up the litigation fight where he left off and the case is currently being heard in Delaware, where the company is incorporated.

A win for the Marohn family would make them one of the largest non-institutional investors in the Coca-Cola Company.
POSITION:  No positions in stocks mentioned.