The Fifth Circuit Court of Appeals has ruled that an Accountable Care Organization providing benefits to private parties as a “substantial” part of its activities is not eligible for exemption as a 501(c)(4) social welfare organization.  The ruling is the first modern appellate court ruling rejecting the claim that an organization can qualify for (c)(4) status so long as its “primary” activity is promoting the public good. 

A commercial loan between a bank trustee of a charitable trust and the charity that is the beneficiary of the trust is presumptively fraudulent without clear and convincing evidence to the contrary, an appellate court in Illinois has ruled.  The Court has reversed a trial court decision authorizing the bank to proceed with an action to collect on the note and granted the charity’s motion to rescind the note for breach of fiduciary duty.

How much of the compensation paid to a charity’s fundraising director is considered “wages” required to be paid to the employee under the District of Columbia Wage Payment Collection Law?

Dorothy Were, a volunteer for the Luo Women in the United States Corp. in Maryland, was found liable for wrongfully filing corporate documents on behalf of the organization, enjoined from acting on behalf of the organization and ordered to pay Luo $21,000 in legal fees and $8000 in compensatory damages.  

Penn State University has been prohibited from proceeding with an internal investigation of the conduct of a University trustee without advancing his legal expenses.  A trial court in Pennsylvania has held that the trustee falls clearly within the protections required by the indemnification provisions of the University’s bylaws and has rejected the University’s defenses in part because they were “specious.”