W. R. Grace has had close ties for more than 30 years with the Flick Group.
Friedrich Flick Jr. is the heir to the fortunes of the Flick family, which was implicated in Nazi war crimes when his father was found guilty in a 1947 trial of taking "full advantage of the slave labor program." In the early 1950s, Flick Jr. came to the United States as a young trainee at W. R. Grace & Co.
In 1975, the Flick Group sold 29 percent of its holdings in the German auto maker Daimler Benz A. G. to Deutsche Bank. To avoid large capital gains taxes, Flick took advantage of West German laws allowing the company to reinvest the money in areas the government deemed "especially beneficial to the national economy."
Flick Jr. approached Grace about an investment. The company decided to take a Flick investment of $104 million, give Flick three seats on the board and scrap a public offering to raise $100 million, saving some legal expenses.
In the fall of 1981, West German government investigators said they turned up evidence of "unofficial donations" from Flick to political parties and allegedly to individuals such as Otto Lambsdorff and Hans Friderichs, who were involved in approving the Flick tax exemptions. They and a former Flick manager, Eberhard von Brauchitsch, are on trial in Bonn charged with bribery and tax evasion. Flick himself has not been charged with any crimes, and Grace officials have maintained that Flick would not be affected if the company were found guilty and had to pay a hefty tax bill.