Lead Stories

James M. Montgomery convinced an employee of a bank he was about to open to invest $100,000 in the business, saying he needed the additional money to meet regulators’ capitalization requirements to start operating.  Shortly after the employee made the investment in 2008 and before the bank opened for business, Montgomery directed the bank to transfer $100,000 to his family foundation.  The bank failed in less than a year and all of the initial investors, including the employee, lost their investments.

A federal District Court in Louisiana has ruled that a six-person group home for individuals recovering from drug or alcohol addiction is entitled to a reasonable accommodation under the Fair Housing Act and the Americans with Disabilities Act and should not be required to install automatic sprinklers and fire alarm systems required by the State Fire Marshal for rooming houses. 

The Supreme Court has ended years of confusion among religious organizations by ruling that an employee pension plan established by religiously affiliated organizations is considered a “church plan” and not covered by the Employee Retirement Income Security Act (ERISA).  Several Courts of Appeals had previously ruled that such plans would be subject to more protective ERISA requirements if not established directly by a church.  (See Nonprofit Issues, March 2016.) 

The Supreme Court, by a 7-2 vote, has held that Missouri may not prohibit a church from applying for a grant to improve its school playground simply because it is a church organization.  The policy violates the “Free Exercise” clause of the First Amendment, the Court has said.

Attorney General Jeff Sessions has reversed an Obama-era policy of having corporate defendants fund nonprofit organizations as a part of settlements of claims for civil or criminal liability.  In a policy memorandum issued June 5, the Attorney General said the practice will stop immediately.

A ten-year volunteer for the Dallas Symphony has lost his claim for defamation and conspiracy to defame against the Symphony and a local magazine after his termination was reported in the magazine.  An appellate court in Texas has granted their motion to dismiss on appeal from a trial court denial.  But the Court of Appeal said it did not have jurisdiction to grant the Symphony’s motion to dismiss the volunteer’s claim for tortious interference with his employment.