Lead Stories

A man who filed an application to reinstate a nonprofit corporation that had been administratively dissolved for failing to file required state reports has been sentenced to 12 years imprisonment for theft of corporate assets when he had no authority to take control of the nonprofit.  An appellate court in Illinois has affirmed the conviction and rejected the man’s claim that he had the right to revive the organization.  (People v. Koen, App. Ct. IL, First Dist., South Div., No. 1-11-3082, 2/7/14.)

When the United Way merged a number of its chapters in the Chicago area in 2003, it did not include the United Way of Harvey in the program because it had significant tax liabilities on an apartment building it owned in Harvey.  The corporation ceased filing its required state filings and was administratively dissolved in 2004.

Members of a nonprofit corporation may call a special meeting to oust directors without asking the secretary of the corporation to send the notice, an appellate court in Washington state has held, when the action is specifically authorized by the organization’s bylaws that permit direct action. (Island Landmarks v. Matthews, Ct. of App., WA, Div. 1, No. 69619-o-I, 12/23/13.)

A nonprofit health insurance benefit administrator has been enjoined from spending police union funds to support or oppose candidates in a union election even though authorized by its own board and the union officials overseeing the administrator. A divided Pennsylvania Commonwealth Court has reversed a trial court and ruled that such action is not authorized by the vendor’s articles of incorporation, bylaws or law. (Zampogna v. Law Enforcement Health Benefits, Commonwealth Ct., PA, No 1322 C.D. 2012, 11/27/13.)

The Tenth Circuit Court of Appeals has reversed a District Court and has held that the Bankruptcy Code permits a bankruptcy trustee to void the entire amount of a donor’s charitable contribution if it exceeds 15% of the donor’s gross annual income. It has reversed a District Court decision holding that the trustee could recover only the amount of the gift that exceeds 15%. (In re: McGough, Wadsworth v. The Word of Life Christian Center, 10th Cir., No. 12-1142,12/16/13.)

A federal District Court in Utah has permitted an association of professional fundraising counsel and an individual fundraising counsel firm to proceed with a constitutional challenge to the Utah charitable solicitation registration statute. The law requires fundraising counsel to register in the state even when they have no contact with the state other than a client that solicits there.  The Court has denied the state’s motion to dismiss for failure to state a claim upon which relief could be granted.

We regularly feature answers to questions from readers in our “To the Point” column. The full list can be viewed here. Here are a few questions recently received from readers.

Can inactive members sue to recoup funds?