Charity Governance

THREE CUPS OF TEA AND A CLASS ACTION LAWSUIT: DRINK THE TEA, DISMISS THE LAWSUIT

DATELINE: May 11, 2011, Chicago

Two Montana residents, Michele Reinhart and Jean Price have filed a lawsuit against Greg Mortenson, the author of Three Cups of Tea, and the Central Asia Institute alleging fraud on the part of both defendants and requesting that the lawsuit be certified as a class action.  Our initial reaction to the filing was that the claimed injury is a bunch of nonsense, but as we read the complaint, we realized the complaint raises some important issues.  Those issues don't change our initial reaction.

The federal district court judge who is assigned this lawsuit should...

A TEXTBOOK CASE FOR EVERY DEVELOPMENT OFFICER AND FUNDRAISER IN THE COUNTRY

DATELINE: January 27, 2011, 2011, Chicago

Robert G. Burton, a major donor to the University of Connecticut, has demanded the return of $3 million that was used to build the Burton Family Football Complex.  After reading a letter from Mr. Burton to Jeffrey Hathaway, the UConn Athletic Director, that was posted on the Connecticut Day’s website and marked “PERSONAL & CONFIDENTIAL,” we can only ask one question:  What would it be like to...

THE SHAPE OF THINGS TO COME: LAWSUIT OVER CLOSURE OF ST. VINCENT’S HOSPITAL

DATELINE:  August 17, 2010, Chicago

Verena Dobnik reported in yesterday’s Washington Post that a group calling itself  The Coalition for a New Village Hospital has filed a lawsuit in New York State court. Former Staff File Suit Against Closed NY Hospital (August 16, 2010).  The suit was filed by Yetta Kurland, an attorney, on behalf of former hospital employees, one-time patients, and area residents.  The Coalition is seeking disclosure of documents under a freedom of information act.  It is demanding a probe and public hearing regarding St Vincent’s finances.  According to Dobnik’s reporting, the complaint questions the salaries of the hospital's top executives and amounts paid to consultants, among other questions it raises regarding the hospital's management.

The filing should be of interest to regulators, nonprofit hospitals, and communities throughout the country.  While we can’t predict how the recently enacted health care reform legislation will play out, it is a good bet, particularly given the already precarious condition of many nonprofit hospitals and other nonprofit health care providers, that this is not...

MISSOURI TAKES UPMIFA FOR A TEST DRIVE: DENIES STANDING TO A DONOR

Dateline: November 11, 2009, Chicago

Yesterday, the Missouri Court of Appeals (Western District, Division III) affirmed a trial court’s dismissal of lawsuit filed by a donor against a charity for lack of standing.  Hardt v. Vitae Foundation, WD 70525 (Nov. 10, 2009).  The case was properly decided.   It is worth noting because it required the court to interpret the Uniform Prudent Management of Institutional Funds Act (UPMIFA), which has swept the country almost as fast as...