(FORTUNE Magazine) – The Koch family of Wichita, Kansas, built its empire on oil and its hatred on blood. A brother-against-brother war in 1980 nearly toppled Koch Industries, a $16-billion-a-year oil services giant that puts the little-known Kochs (pronounced ''cokes'') in the ranks of the Hunts and Gettys. Today, after a buyout of dissident brothers William and Frederick, the company is firmly under the control of Charles Koch, 51, chairman, and his brother David, 47, executive vice president. They own about 80% of the stock and together are worth $3 billion. But family wounds still linger. In August David's fraternal twin, William, filed two suits. One alleges that David and Charles misrepresented the assets of Koch Industries in agreeing to an estimated $1.5-billion buyout of William and Frederick. The other suit names, among others, David, Charles, and their 79-year-old mother, and challenges the method of dispensing funds from a family charity. The feud seems all the more strange because Koch Industries has prospered during tough times in the oil business. It has laid off only 400 of its 7,000 workers, continues to make acquisitions, and has some of the most efficient refining and transportation facilities in the industry. The Kochs are hardly the only unhappy billionaires in the oil patch. The offspring of Dallas wildcatter H. L. Hunt are also in a jam. Hunt had four sons -- Bunker, Herbert, Lamar, and H.L. III (Hassie) -- and two daughters by his first wife. He had a son, Ray, and three daughters by his second. His eldest daughter, Margaret Hunt Hill, controls trust funds worth $1.6 billion that belong to herself and Hassie, who was institutionalized with mental problems in the early 1940s. Margaret has had to scramble to protect the money from creditors of her other brothers' businesses, which suffered big reversals in the oil and real estate markets. Ray Hunt, who runs his own oil company, isn't involved in his half-brothers' troubles. He, his mother, and sisters are worth about $1 billion. Sid Bass, who shares $4 billion in gas and oil properties, real estate, and stocks with his three brothers, is involved in a messy divorce from his wife, Anne. Family squabbles led the Gettys to sell their 40% interest in Getty Oil, though Gordon P. Getty still heads a $3-billion family trust (his own net worth is $1.2 billion). And Philip Anschutz, a $1-billion Denver oilman, is upset because politicians and businessmen have blocked his plan to build a $102-million downtown convention center. Marvin Davis, another oil billionaire, is a happier man. He recently shook free some of his $1 billion to buy the Beverly Hills Hotel. Beverly Hills is the last place you would expect to find Charles and David Koch. Not for them the glamour of Tinseltown. Charles lives near his mother in a five-bedroom stone-and-glass house that, he says, is ''bigger than I need.'' He and his wife of 15 years have two children. Charles's one material indulgence is a condominium in Vail, Colorado, where he likes to ski. David, a bachelor, spends a bit more. Last year he bought an Aston Martin, but his real interest is financing -- and participating in -- scientific expeditions to exotic places. He helps support the continuing search for fossils of early man at Olduvai Gorge in Tanzania, and last year he took his mother to the Galapagos Islands. Both men's biggest indulgence is politics, of the right- wing variety. Charles backs a Libertarian foundation for policy studies, the Cato Institute, with several million dollars. In 1980, at Charles's urging, David ran for vice president on the Libertarian ticket. The brothers have worked hard to strengthen the considerable position Koch Industries has in the oil business. The company is mainly a trader, refiner, and transporter of oil, petroleum products, and chemicals. It has 20,000 miles of pipeline, two refineries, and six gas-processing plants, as well as coal mines and vast cattle ranches. Charles's basic strategy is to lower the costs and increase the profits of petroleum products, partly by making his refineries more efficient. ''We've improved the business one step at a time,'' he says. ''If we had stayed with what we had in the company, we might not be here today.'' When founder Fred Koch died in 1967, Koch Industries had revenues of $250 million. Today it is larger than Procter & Gamble. Still, the Kochs' business success has often been overshadowed by their failures as a family. Viewed one way, the revolt by William Koch was, as a member of William's camp said in 1982, a classic struggle in a private company ''between stockholders who want yield and liquidity and a management that wants power and authority.'' Viewed another way, it was sibling rivalry out of control. Frederick, 54, the eldest son and namesake of the founder, was disinherited because he was more interested in books and theater than in oil. Now a noted art collector, he lives in Monaco and London and has nothing to do with the family business. He sided in 1980 with William, an avid sailor who lives in a Boston suburb. ''Sibling rivalry is Charles's favorite cop-out,'' says William. Although the oil business is better this year than last, the Kochs know the tough times aren't over. ''Being big doesn't guarantee survival,'' says David. ''The dinosaurs were big.'' For the Kochs and other families who made their money on fossil fuel, it is a lesson to remember.