STATE LAW

Alabama 

A Madison man was sentenced to 2.5 years in prison and ordered to pay over $1.3 million in restitution after being convicted of stealing from his former employer, a Huntsville nonprofit.
 
California
 
According to Variety, a trade publication, a suit has been filed in Los Angeles over the right to display memorabilia of Audrey Hepburn. Audrey Hepburn died in 1993 and the intellectual property is owned by her two sons. One son left the Audrey Hepburn Children’s Fund over disputes about how the charity was using her intellectual property and is now contesting the right of the charity to sell and display the memorabilia.
 
Florida
 
The Associated Press reports that the attorney who used a veterans group as a front for a $300 million gambling ring will receive a new trial. The court ruling that the trial judge had not allowed the defendant to call certain witnesses was found to be error. The defendant was convicted in 2013 of 103 counts of racketeering and possessing slot machines, along with other charges. The case led to the resignation of the lieutenant governor of the state and caused the legislature to ban internet cafés.
 
Illinois
 
A number of social service agencies have joined forces to sue the state of Illinois to begin “timely payments” for services under contracts dating back more than one year. Among the organizations included are a nonprofit headed by the state’s first lady.
 
Massachusetts
 
The Boston Globe reports that the Yawkey Foundations has come under scrutiny by both the newspaper and perhaps the state Attorney General as a result of grants it has made over the years to organizations related or connected in some way to current trustees or board members. The Foundation, itself, was funded with $375 million when the Yawkey family sold the Boston Red Sox. According to the published report, one out of every four dollars in grants has gone to an entity related to one of the Board members. In addition, the paper and industry experts have criticized the organization for its salaries and expenses. The Attorney General’s office has refused to comment.
 
Missouri
 
A Federal District Court Judge has ruled in St. Louis that the Missouri Do-Not-Call Law does apply to calls made on behalf of nonprofit organizations by professional agencies. The suit was brought against an out-of-state telefunder and, in addition to violations of the Do-Not-Call Law, alleged violations of the Missouri Merchandise Practicing Act, the TSR, and the TCPA. Cross motions for summary judgment were filed. The most disturbing part of the decision is the Court’s reinterpretation of Missouri Law which defines a telephone solicitation as a call placed to encourage the purchase or rental of goods or services. The Court pointed to the exceptions which included calls made by bonafide employees and volunteers. The Court also found that it was a misrepresentation to say that the monies went directly to the organization. Whether this decision will be appealed or not remains to be seen.
 
New York
 
The Times Union of Albany reports that The New York State Association of Black and Puerto Rican Legislators, Inc. spent less than 10% of the money raised by the organization for scholarships- its stated purpose. The paper goes on to say that the funds have largely gone to support annual weekend gatherings, including expenses that included limo services, pricey entertainment, and well-paid speakers.
 
Pennsylvania
 
In 2013, a building adjacent to a Salvation Army Thrift Store collapsed killing seven people and injuring 12. Nineteen individual plaintiffs brought suit against the Salvation Army and the building developers in a trial that went on for 13 weeks before a settlement was reached. The Salvation Army was a named defendant even though its store was destroyed and two of its workers were killed. The claim by the plaintiffs was that the Salvation Army was liable for ignoring warnings of imminent collapse of the adjacent building and not telling workers and customers about the potential danger.
 
Commentary: Once again the importance of liability insurance is underscored. In this case, the Salvation Army reportedly had liability insurance coverage of $100 million.
 
Virginia
 
Playing a video game for charity may have resulted in the death of a popular Virginia Beach resident. The 35 year old father-of-three died while participating in a 24 hour marathon video gaming session to raise money for the Make-A-Wish Foundation.

OTHER MATTERS
 

Internal Revenue Service

The IRS has announced that publicly available information from approved applications for tax-exemption using for 1023-EZ is now available electronically for the first time.
 
Nonprofits and Politics
 
Nonprofit organizations and politics are generally a bad connection. President Trump said he will work to end the 63 year old law that limits nonprofit organizations’ political activities.
 
Commentary: The ramifications of such a change could be beyond anyone’s current contemplation.