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At the same time that Medenica's research was being called into question, auditors were beginning to look closely at the foundation's financial ledgers. The reason, according to court documents filed in Jefferson County, was a series of mysterious checks written between a company called Advantage Clinic and the Adolph Coors Medical Research Foundation.
Advantage Clinic was set up five years ago in Stevinson's Denver West office complex. The privately owned, for-profit company conducts standard medical lab work such as blood testing; it is controlled by the Stevinson family and a handful of local physicians. (Advantage is not connected with the now-defunct clinic Chuck Stevinson built for Medenica.)
Although it had no official link to the Adolph Coors Medical Research Foundation, Advantage and the foundation shared boardmembers. Henry Cleveland, who heads Sloans Lake Managed Care, and E.A. Smith, a pathologist at St. Anthony's Hospital, sat on both boards.
Advantage and the foundation also shared several paid administrators. Donald Smith headed Advantage from January through July of this year, when he quit. He remains president of the Adolph Coors Medical Research Foundation. His wife, Patricia Reykdal, was Advantage's chief operating officer and also did some work for the research foundation.
Two months ago Advantage's owners filed suit against Donald Smith and his wife in Jefferson County District Court. Their lawsuit claims that Smith took more than $300,000 from Advantage. He allegedly used some of the money to pay alimony to an ex-wife and to place other relatives on the payroll.
The lawsuit also alleges that there was an unexplained flow of funds between Advantage and the Adolph Coors Medical Research Foundation. The checks, signed by Smith, were for small enough amounts--less than $2,500--that they did not require a co-signature under company policy.
Smith has denied any wrongdoing and is fighting back against what he claims is an effort to discredit him with Bill Coors. In one legal filing, Smith's attorney charges that "Advantage and its officers, directors and shareholders have made numerous slanderous comments to members of the Coors family and other members of the community relating to their unsubstantiated allegations of improper conduct." (Smith did not return phone calls from Westword.)
"We're just trying to get things cleaned up," Scott Stevinson says of Advantage's financial audit and the resulting suit.
Bill Coors says he has no knowledge of any money being transferred from Advantage to the Adolph Coors Medical Research Foundation. Nevertheless, he has ordered an audit of the foundation. In the meantime, he says, he will continue to support the foundation's president.
"As far as Don Smith is concerned, I think he's one of the most remarkable men I've ever met," Coors says. "I'm behind him 100 percent."
The foundation's other boardmembers apparently felt differently. Most have quit the board in recent months, and sources suggest they resigned in order to avoid association with the foundering foundation and its increasingly messy money matters.
Dr. Henry Cleveland, who resigned from the board this past summer, disputes that; he says he left simply because he was too busy. "I resigned because I was working so damned hard here," he says. Other boardmembers who recently stepped down--pathologist E.A. Smith and oncology nurse Deborah Nelson--did not return calls from Westword.
E.A. Smith's son Steven, the lawyer who helped obtain the foundation's nonprofit status, also sat on its board. "I was excited doing it," he says. "The goals were pretty decent--to provide a nonprofit foundation concerned with AIDS and other diseases that didn't rely on the government for support. This could be a faster channel for getting things done."
But in August Steven Smith, too, left the board. He declines to say why, stressing that it is a time he doesn't want to think about anymore. "It's been such a turbulent period that I feel I want to do anything I can to put it behind me," he says. "I just want to lead my life now."
Bill Coors acknowledges that the multiple resignations are "a problem...All I know is that I received a lot of letters of resignation without any explanation in them." But he admits it's possible the boardmembers quit because of the foundation's financial turmoil.
The numerous departures have left only Coors and Donald Smith running the research foundation. Still, Coors sees the setbacks as temporary. "The foundation is sort of in a hiatus, in a state of reorganization," he says.
Before its recent troubles, he adds, the foundation was on the cusp of great discoveries. "It's too early to make any claims of what we've accomplished through the foundation," Coors continues. "But we have developed certain protocols that will allow people with HIV disease to live out their lives without full-blown AIDS."
Unfortunately, Coors concludes, the foundation now will be forced to concentrate on more mundane things, such as raising money and hoping that Medenica gets out of prison soon.
First, however, the foundation could have to clear the air with the Internal Revenue Service.
One responsibility of a nonprofit organization is to ensure that its officers don't benefit financially beyond their agreed-upon salaries. An IRS spokesman says that if Donald Smith were to have enriched himself from the Adolph Coors Medical Research Foundation, the foundation could be charged with violating tax laws. Yet even if the allegations against Smith are unfounded, the tax agency may have a quibble with the foundation's tax-exempt status.