Lead Stories

An antique car museum in Maine that is a permissible beneficiary of a separate trust created by the museum’s founder to support antique car museums has standing to sue the trustees of the trust and reopen the litigation, even after the trustees have settled the claims with the state Attorney General.  The Supreme Judicial Court of Maine has reversed a trial court decision dismissing the claims.

More than ten years after Ruston Louisiana Hospital Company, LLC purchased substantially all of the assets of Lincoln General Hospital from the Lincoln Health System and began operating the hospital on a for-profit basis, the Center for Medicare & Medicaid Services gave Ruston notice that it was being asked to repay more than $700,000 in overpayments of Medicare made to Lincoln before the sale. 

The Commonwealth Court of Pennsylvania has rejected an attempt by the state’s Attorney General to close down a volunteer fire company that had been prohibited from fighting fires in its community and to force the transfer of its assets to a different company continuing to serve the area.  The Court rejected the AG’s claim that all of the assets of the decertified company were held “in trust” and should be transferred under the cy pres provisions of the state’s Trust Code when it became “impracticable” for it to pursue its mission.

The head of a private family foundation has been convicted of failing to pay federal income tax on the value of scholarships paid by the foundation for tuition for his children.  The charges were among several that caused James L. Wright to be sentenced to 33 months in prison and ordered to make restitution of $146,404.

“This is a classic case in which failed corporate governance led to distrust, dissention, and disorganization.  With all the best intentions aside, had these two nonprofit entities followed corporate principles and practices likely no lawsuit would have been filed.”

The Court of Appeals of Ohio has ruled that directors of a nonprofit trade association cannot be sued on behalf of the corporation for turning down a settlement offer in a defamation suit that would have saved the Association $43 million.  But it has also ruled that it had no jurisdiction to force the Association to indemnify the directors who successfully defended the suit, saying that could be done only by a court in Delaware, the state of the Association’s incorporation.