At 2:30 PM Tomorrow, NRA Defends Against Members Attempting to Join Lawsuit Against Organization
Last Week, Counsel for Dissident Members Indicated Sitting Board Members May Join Their Motion
After the NRA’s failed bankruptcy earlier this year, it is now forced to turn back to several lawsuits pending against the organization across the country. This includes an appearance in the New York Attorney General’s case against the NRA, Wayne LaPierre, and other NRA leaders tomorrow at 2:30 pm ET for oral argument on a motion from two NRA members to intervene in the New York Attorney General’s lawsuit. This is the first time the NRA will appear in this case since federal judge Harlan Hale dismissed the bankruptcy filing for lacking good faith in May. The dissident NRA members seek to join the lawsuit to “work with the Attorney General in reforming the NRA’s leadership,” although they oppose dissolution of the organization entirely.
Additional drama to the proceedings was added just last week when counsel for the dissident members informed the court that “at least one, and possibly two, sitting directors of the NRA wish to join the motion to intervene.” The directors were not identified.
At the heart of the members’ objections is the leadership of Wayne LaPierre and his alleged capture of the board of directors. In their motion to the court, the dissident NRA members write that LaPierre has “complete control” over the NRA and that the board of directors “is not independent.” The members write that they seek to hold LaPierre and other NRA executives named as defendants “liable for their breach of fiduciary duties and corporate waste.” The proposed intervenors also raise issues about potential conflicts of interest with the Brewer law firm, which is representing the NRA in this case. The Attorney General alleges that the Brewer law firm has billed the NRA nearly $75 million in recent years and a longtime LaPierre confidant has testified that LaPierre said Brewer was the only one standing between him and “an orange jumpsuit.”
Earlier this summer, the NYAG filed an amended complaint against the NRA, incorporating several revelations from the failed bankruptcy, including using the haphazard Chapter 11 filing as evidence of the NRA’s continued mismanagement.
Tomorrow’s oral arguments come when the NRA is already mired in immense legal, internal, and financial turmoil:
- Legal: After trying to escape the lawsuits it was facing with its failed bankruptcy filing in Texas—dismissed by a federal judge earlier this year for lacking good faith— the NRA is back to fighting the various legal cases it faces. New York Attorney General Letitia James filed suit last year seeking to dissolve the NRA for allegedly violating New York charities law. On the same day, DC Attorney General Karl Racine sued the NRA for allegedly exerting undue influence over the NRA Foundation. Additionally, the NRA remains locked in various lawsuits with former business partner Ackerman McQueen.
- Internal: Experts believe that Wayne LaPierre’s removal is “a foregone conclusion” due to the NRA’s legal troubles. During the NRA’s bankruptcy trial, there was testimony in open court about LaPierre’s mismanagement of the organization, with even a then-board member saying “I believe that the management is corrupted and I believe the board is corrupted. I don’t see anything there that is salvageable.” At least twelve members of the NRA’s board have resigned in the past three years. There have been reports of employee layoffs and furloughs, with court and regulatory filings suggesting the NRA had reduced its employee base by more than a third.
- Financial: Legal spending at the NRA is reportedly through the roof — reaching $22 million in the first five months of 2021 alone and on pace to exceed the record $40 million spent on legal fees in 2020. In fact, legal costs are reportedly now the NRA’s largest single expense after membership activities this year. Meanwhile, the NRA has cut its spending on “safety, training, & education” programs by more than a third in recent years. Revenue is also dropping, with 2020 revenue down nearly 25% compared to 2016. This follows years of alleged financial mismanagement, during which NRA executive pay skyrocketed, money flowed to “unpaid” board members, and the NRA’s own board members and accountants called into question lavish, legally suspect personal spending by its leadership.