In the latest public skirmish involving the family of one of Atlanta's favorite sons, Bernice and Martin King III have filed a lawsuit against their brother, accusing him of mishandling funds and hiding documents from them.

At stake are millions of dollars in assets that flow through King Inc., the corporation that oversees the intellectual property rights of Martin Luther King Jr. Dexter King is the president of the corporation. Bernice and Martin III are shareholders.

Dexter King denied the lawsuit's accusations, calling them "inappropriate and false.

"When there are family disputes that involve a business entity, unfortunately, sometimes certain legal steps are taken to resolve the dispute," he said in a written statement. "I'm disappointed that our personal family disagreement, as it relates to the family business, has evolved into being handled in a public legal forum."

Dexter, the third-born of Martin and Coretta King's four children and chairman of the King Center, said he hopes the matter can be swiftly resolved so that the family can "go about the business of focusing on our parents' tremendous legacy."

Funds come into King Inc. from books and promotional sales of King items. But the biggest asset is the $32 million that the city of Atlanta —- led by Mayor Shirley Franklin —- plunked down to purchase the King papers in 2006.

Jock Smith, an attorney representing Bernice and Martin III, said the siblings have been denied "information and documentation concerning the operations, actions and financial affairs" of King Inc.

According to court documents, the siblings say Dexter King, who lives in Malibu, Calif., has "misapplied or wasted" the corporation's funds, using the money for his personal benefit.

They also claim that he has wrongfully taken "substantial funds" out of the estate of Coretta Scott King, which is managed by Bernice, for his own personal use. Dexter has 30 days to respond to the lawsuit.

"He owes Martin and Bernice an accounting of what has happened with all of the money. Where is the money going?" Smith said. "We're trying to get an accounting as to the financing and well-being of the [corporation]. The way to do that is to get records, books and accounting."

Smith said there have been financial distributions from the corporation, but "whether those distributions were what they should have been is the question."

Smith said one of the goals of the lawsuit is to force Dexter King to call a board meeting of King Inc., which includes the siblings and other shareholders.

"The lawsuit alleged that there has been no meeting for several years," said Smith, the national president of the Cochran Firm, based in Alabama. He has filed an application to become the attorney of record. "There needs to be a board meeting called so there can be an accounting to all stockholders. Not only about the money, but the actual corporation itself to make sure that everyone has been treated fairly."

The lawsuit was filed Thursday in Fulton County Superior Court.

None of the siblings would speak to the Journal-Constitution.

This isn't the first time that the siblings have been on opposite sides of a public airing of family business.

Shortly after the death of family matriarch Coretta Scott King in January 2006, Dexter King began talk of selling the King Center to the federal government.

That move was publicly denounced by Martin III and Bernice, who wanted to keep in family hands the organization their mother founded in 1968 to honor their father.

Yolanda King sided with Dexter. After her death in 2007, talk of the sale quieted. But Smith said business relations still remained strained.

The attorney said Bernice and Martin III went through "much heartfelt thought and prayer" before deciding to file suit against their brother, because they knew the decision would draw scrutiny.

"This was a very, very difficult decision," Smith said. "The legacy of their father and the maintenance of that legacy is more important to them than anything in the world. That is probably one of the reasons they have been forbearing in this decision. But what they are really trying to do is preserve the legacy of Dr. King."

Before the story was even picked up Friday by the Associated Press, it was the lead story on The Smoking Gun, and TMZ.com, a gossip site that devotes much of its attention to the exploits of Britney Spears and Lindsay Lohan. The headline: "Martin Luther King's Bad Dream."

"It is not unusual for siblings to have differences, but these are different siblings," said the Rev. Joseph Lowery, a veteran civil rights leader. "Therefore, they draw national attention. I hope they can reconcile before they engage in a court fight."

Former Atlanta Mayor Andrew Young, who worked alongside Martin Luther King Jr., said, "I think there's always been tension produced by distance. Dexter is running the affairs but not living here.

"The only conversation I've had was one with Martin (on Thursday). He wanted to reassure me that there was no vendetta, no ill feelings, that this wasn't a family feud. It was only a request to get more complete information that for some reason they weren't getting. They didn't want anyone to be hurt."

The last straw might have come on June 20.

On that day, court records allege, Dexter King "without authorization and without notice" to Bernice King, the executor of her mother's estate, "converted substantial funds from the estate's financial account."

Smith said there's no possibility that criminal charges would be filed against Dexter King.

"We are trying to go to the courts as an arbiter. We are asking the court to be a referee," Smith said. "We do not want to punish or defame someone. We want to get a full airing of the issues and preserve the legacy of a man who gave his life for America and his people."

The lawsuit asks that Dexter King furnish documents held by employees, lawyers, financial advisers and others acting on behalf of the estate, according to court records. It also seeks board meeting minutes and other records, including e-mails and financial documents concerning the estate.

Many hope the issue will be settled soon, without lengthy court proceedings.

"It is sad that the King legacy, which espouses negotiation, reconciliation and love has to have this," Lowery said. "But they will get over it. I am hoping they remember who they are and whose they are. Let's all engage in prayer that it will be settled."

AJC staff writers Chandler Brown, Marcus K. Garner, Maria Saporta and Michelle Shaw and news researcher Richard Hallman contributed to this story.