Lead Stories

The New York State Attorney General has standing to sue the president of a nonprofit club for waste and breach of fiduciary duty in an independent action, despite a similar claim by the Club in pending litigation with the officer.  A trial court in New York City has ruled that the Attorney General has statutory authority and that there was no identity of the parties or claims in the separate action.  (People v. James, Supreme Ct., New York County, NY, No. 451488/2012, 4/3/13.)

An officer of a local church within the Evangelical Lutheran Church of America has obtained a mixed decision in seeking discharge of her obligations to the Synod in a personal bankruptcy proceeding.  The Bankruptcy Court has ruled that she may be discharged from a guaranty she made to assist the local church to mortgage its property during a dispute with the Synod over control of the local organization.  But it has ruled that she acted willfully and maliciously in refusing to transfer the assets in a bank account to the Synod following a court injunction to do so.  (In re: Gotwald, Bankruptcy Ct., E.D. PA, No. 10-14759, 3/26/13.)

The former commander of the Military Order of the Purple Heart has lost on all claims against the Order and various officers for what he alleged was an improper expulsion.  The Court of Appeals of Mississippi has affirmed a trial court decision dismissing all claims.  (Cook v. Wallot, Ct. of App., MS, No. 2011-CA-01056-COA, 5/7/13.)

While national commander of the organization in 2007, Henry J. Cook began an investigation into the alleged mismanagement of charitable funds by the Military Order of the Purple Heart Service Foundation, which raised funds to support the operations of the Order.  The allegations received national media attention and created confusion about the activities of the Order itself.  Several members of the Order’s finance committee filed a grievance against Cook.

A juror’s letter to the trial judge expressing concern over the fate of a “really good person” does not provide the basis for overturning a five year sentence for the treasurer of a youth hockey league who admitted that he used more than $290,000 in league funds to keep his business afloat.  An appellate court in New Jersey has denied the treasurer’s request for a new trial and rejected his claim that he did not have a fiduciary relationship with the league.  (State v.

Directors of a homeowners’ association accused of obtaining personal benefit from their allocation of limited road construction and maintenance funds may not be sufficiently “independent” to determine whether a derivative suit brought against them by other homeowners is in the best interests of the corporation, the Utah Supreme Court has ruled.  It has reversed a trial court decision dismissing the case when the committee conducted an investigation and recommended that the suit be dismissed.  (Hi-Country Property Rights Group v. Emmer, Supreme Ct., UT, No. 20120202, 6/7/13.)

A city council lost its right to name directors to the local hospital board when the hospital board amended its bylaws to eliminate the City’s power to appoint, and the City had no standing to contest the action, the Supreme Court of West Virginia has ruled.  (City of Fairmount v. Fairmount General Hospital, Supreme Ct., WV, No. 12-0205, 6/5/13.)