Insurance Doesn’t Protect Entity From Claims Against Merger Partner

Courts agree that policies do not cover claims of wrongdoing by the merged organization occurring before effective date of merger

A claims-made insurance policy normally protects the insured organization against claims brought during the term of the policy against the insured company for “wrongful acts” by the insured company and its subsidiaries.

MA Court enjoins NIH stoppages

The federal District Court in Massachusetts has enjoined further implementation of Supplemental Guidance on the 2024 National Institute of Health Grants Policy Statement in three separate suits consolidated for decision.  One case was brought by the Attorneys General on behalf of 22 states. One was brought by five medical associations and one was brought by 17 other associations and universities.  The plaintiffs argued that the Guidance (NOT-OD-25-068), a rate change notice that impacts thousands of existing grants totaling billions of dollars in all 50 states, ignores existi

WA Court issues preliminary injunction on states’ claim to stop transgender orders

A Federal District Court in Washington (Lauren King) has issued a preliminary injunction on behalf of four states and several physicians seeking to enjoin several federal agencies from enforcing portions of two Executive Orders signed by President Trump to utilize his preferred definitions of “sex” “male,” “female” and “gender identity” (EO 14,168) and to stop funding for treatment of transgender patients (E.O. 14,187).

D.C. Court grants administrative stay on stopping payments for work

In one of the first cases brought to stop the Administration’s efforts to “pause” federal programs at the U.S. Agency for International Development, the U.S. District Court for the District of Columbia (Loren L. Alikhan) issued an “administrative stay” in a suit brought by the National Council of Nonprofits and others against the Office of Management and Budget.

CA Court issues TRO on firing probationary employees

A federal District Court in Northern California (William Alsup) has issued a temporary restraining order of firing probationary employees pursuant to directives from the Office of Personnel Management.  The plaintiffs included a number of individual employees who had been terminated and a group of organizations, including the American Federation of Government Employees and numerous nonprofit organizations with interests in specific governmental programs.

Taxpayers’ valuation of property off by $11 million

The taxpayers valued the property sold to a charitable organization at $15.8 million and claimed a total charitable contribution deduction on the basis of their appraisal of the property compared to the bargain-sale price the charity paid for it. In reviewing the transaction, the Internal Revenue Service concluded that the property was worth only $4.05 million and reduced the claimed charitable contribution deduction taken over several years on the taxpayers’ returns by more than $11 million.  The Tax Court has affirmed the IRS valuation and its imposition of the 40% gross valuati