Board Can’t Bar Director For Breach of Confidentiality

Court says ban from executive sessions would prevent her from performing duties

The board of directors of a nonprofit homeowners’ association may not bar a fellow director from attending executive sessions of the board because she violated confidentiality requests.  An appellate court in Arizona has reversed a trial court decision denying the excluded director’s application for a preliminary injunction to overturn the ban.  (McNally v. Sun Lakes Homeowners Association, Ct. of App., AZ, No. 1 CA-CV-15-0744, 10/13/16.)

Who Speaks for the Animals?

Court denies standing to organization and individuals seeking to stop export of chimps

“The question of who can speak for the animals has long vexed federal judges in animal-welfare cases,” a judge in the federal District Court for the District of Columbia has written recently.  “As a general matter, courts have concluded that well-established principles of Article III standing permit human beings to invoke their own injuries in fact to challenge harms done to animals, but it can be exceptionally confusing to apply settled standing doctrine to determine when and under what circumstances an act that is allegedly harmful to animals works a cognizable injury in fact to huma

Employee may proceed with discrimination suit

An employee allegedly told that she was passed over for a promotion because the selected candidate had “a management background” and “you were on maternity leave for a while” has sufficient evidence of sex discrimination to proceed to suit, a federal District Court in Maryland has held.

Non-existent entity not entitled to exemption

The Internal Revenue Service and a federal District Court are justified in saying that an non-existent entity is not entitled to federal income tax exemption as a 501(c)(4) social welfare organization, the First Circuit Court of Appeals has held.  The conclusion was reached in an appeal by a convicted tax evader who was trying to avoid having to personally pay $3.79 million in income taxes owed on money received from his creation and sale of health supplements.

Charity Officers Sued for Breach In Administering ERISA Plan

DOL claims breach in soliciting contributions from service providers, obtaining job for son

Charities and others are increasingly facing suits for alleged breach of fiduciary duty in failing to hold down the costs of various pension and benefit plans covered by the Employee Retirement Income Security Act (“ERISA”).  (See Nonprofit Issues®, 6/16.)  But a Department of Labor suit against a group of nonprofits in Maryland has raised two additional issues:  that charity officials breached their fiduciary duty in one case because they solicited charitable contr