Lead Stories

A bankruptcy court in western Pennsylvania has dismissed a bankruptcy proceeding it found was not filed in good faith by directors of a nonprofit corporation when the corporation was not insolvent and the board was fighting for control of the organization in a pending state court proceeding.  (In Re: Laurel Highlands Foundation, Inc., Debtor, Bkrptcy Ct. W.D. PA, No. 12-22558, 6/12/12.)

The federal District Court of New Jersey has allowed a former employee to sue her nonprofit employer for invasion of privacy for allegedly coercing another employee, who was her “friend” on Facebook, to reveal a Facebook posting to the employer who was not a friend and had no access to the posting.  (Ehling v. Monmouth-Ocean County Hospital Service Corp., No. 2:11-cv-03305, 5/30/12.)

An appellate court in Tennessee has approved the removal of the president of a nonprofit neighborhood association pursuant to the organization’s bylaws and rejected a claim that the president had a property interest in his position.  (Green v. Jones, Ct. of App., TN, No. E2011-02587-COA-R3-CV, 7/10/12.)

A nonprofit organization that enters into a construction contract with a company owned by one of its directors may bring a separate breach of fiduciary duty claim against the director/owner when things go bad and is not limited to arbitration by the arbitration clause in the construction contract, an appellate court in Pennsylvania has held. (Elwyn v. DeLuca, Superior Ct., PA, No. 1519 EDA 2011, 7/2/12.)

A federal District Court has refused to vacate an arbitrator’s award of more than $8 million to several nonprofit advocacy groups when their fundraising counsel violated a confidentiality clause in their agreement by giving proprietary information about their operations to their opponents on an Alaskan ballot measure.  The Court said that the fundraiser had failed to show that the arbitrator had “manifestly disregarded” the law in reaching his decision. (Fund Raising, Inc. v. Alaskans for Clean Water, C.D. CA, No. CV 09-4106, 6/26/12.)

When representatives of the Evangelical Methodist Church met with individuals about forming an EMC church in Nampa, ID, the group created the New Heart Community Fellowship Evangelical Church of Nampa and signed an agreement with EMC agreeing to follow its rules and regulations.  Five years later, the pastor informed EMC that he had resigned as pastor of New Heart and was serving as pastor for a new church called The Crossing.