NRA Trial – It Is Now In The Hands Of The Jury

The trial began on January 8th with the attorneys for the New York Attorney General’s Office making their case against the NRA, Wayne LaPierre, Woody Phillips, and John Frazer for breaches of the Estates Powers & Trust Law, breaches of fiduciary duties under the Not-for-Profit Corporation Law, related party transactions, violation of New York’s whistleblower law, and false filings. Josh Powell had earlier entered into a plea agreement in which he pleaded guilty and agreed to pay $100,000 in restitution. The state’s case was concluded on February 5th and then the attorneys for the NRA and the individual defendants began to make their cases for acquittal. Finally, today both sides gave their closing arguments and the jury will begin deliberation tomorrow.

In the interim, Wayne LaPierre’s reign over the NRA ended on January 31st. He announced his resignation on January 5th. One thing I did notice almost immediately after LaPierre’s announcement is that the attorneys from Brewer, Attorneys and Counselors, went from “keeping Wayne out of jail” to saying it was “all Wayne’s fault”. They have argued that Wayne, Woody, and company kept the NRA Board of Directors in the dark and, as such, the NRA can’t be held responsible for their actions.

The New York Attorney General’s Office’s Second Amended Complaint listed 15 causes of action against the NRA and the individual defendants. At the conclusion of the state’s case, attorneys for the NRA asking for a directed verdict saying, in effect, the Attorney General’s Office had not proved their case. Likewise, attorneys for the individual defendants argued that they were not liable under some of the causes of action. This past Monday, February 13th, Judge Cohen ruled on these motions. He rejected the NRA’s argument that the 1st Cause of Action – Breach of the Estates Powers & Trustees Law be dismissed over “vagueness”. He dismiss similar causes of action (6, 7, and 8) against the individual defendants holding that they could not be classified as “trustees” under the EPTL. With the exception of the related party transaction involving LaPierre which he dismissed today, all the other charges against the individual defendants remain.

One thing that has been often overlooked is that the victims in this case are those of us that are members of the NRA. Beyond paying for the private planes, suits, and trips for LaPierre, it has been our dues and contributions that have been used to pay the legal bills for both the NRA and the individual defendants. While I can’t speak for Woody Phillips, I am sure that both LaPierre and Frazer will submit bills to the NRA for their legal expenses to be reimbursed under the Directors and Officers insurance policy. This would be over and above what is being spent with Brewer, Attorneys and Counselors where it takes approximately the dues from 22 annual members to pay for one hour of legal representation.

I will cover the closing arguments in a separate post in order to keep this post from being too long.

Josh Powell Gets His Deal From NY AG

Josh Powell came to terms with the New York Attorney General’s Office and will be dismissed with prejudice from the case once the deal is approved by Judge Joel Cohen.

Under the terms of Stipulation of Settlement, Powell will:

  • Admit he breached his fiduciary duties of care, loyalty, and obedience by using charitable assets for his own benefit or that of his family;
  • Admit he failed to administer charitable assets entrusted to his care properly;
  • Will pay restitution of $100,000 to be held in escrow for the NRA;
  • Be permanently barred from serving as a director, officer, trustee, or in any role with fiduciary duties for any non-profit or charitable organization incorporated, registered, operating, or soliciting donations in New York State;
  • Agrees to accept service of a subpoena for appearance at the trial;
  • And will be responsible for fees and expenses associated with his testimony at the trial.

Provided that Powell keeps to the terms of the stipulations, the Attorney General’s Office will dismiss him from the lawsuit with prejudice. They will also consider it a resolution of all claims against him. The agreement then goes into great detail of what would be considered a breach or voiding of the agreement including denying that the case is without factual basis. If the agreement if breached or voided by Powell, he can expect the AG’s Office to come after him with a vengeance.

We have been expecting this for a few days. The only surprise to me is that Powell now resides in San Juan, Puerto Rico. Using Google Maps street view, it appears to be in a building with a wine shop on the first floor next to a Wendy’s.

I have embedded the full Statement of Stipulation and Order of Dismissal below.


Josh Replies

Josh Powell replied to the court’s inquiry yesterday by email. The reply confirmed one thing that is in the works. Powell is trying to work a deal with the New York Attorney General’s Office. If you look at the third item in his response, you see he hopes that by the end of this week that a “stipulation of settlement” and an “order of dismissal” will be entered.

As I noted with regard to the New York Times article, Powell is the most vulnerable of the defendants in the case. Thus, it is not surprising that he is seeking a settlement with the Attorney General’s Office.

Powell states he is not able to retain counsel. He goes on to say that he was informed that the NRA’s D&O (Directors and Officers) insurance coverage will not cover his legal bills and that any leftover monies will go to pay the NRA’s fees. What this tells me is that given Powell has crossed the NRA with his tell-all book they are hanging him out to dry. It is also a not so subtle warning to anyone else such as former First VP Willes Lee they better stick to the NRA’s party line as promulgated by Bill Brewer or else they will suffer the consequences.


Josh, You There?

Judge Joel Cohen issued a court notice yesterday asking, in essence, if Josh Powell or his attorneys intended to show up for jury selection and the trial. Given jury selection started on Tuesday, January 2nd, I take it that neither Powell nor an attorney representing him showed up for it.

You may remember that his prior attorneys, Akin Gump, dropped him for what appeared to be a failure to pay his legal bills. Indications at that time were that Powell was then going to act pro se or as his own attorney.

Now I have to wonder if he will just default by not showing up for the trial. It would be foolish to do so especially if he had been trying to cut a deal with the New York Attorney General’s Office. Oh, well, more than one former director has told me that Powell was not the sharpest knife in the drawer.


NY Times On NRA Trial

Danny Hakim has been the lead New York Times reporter covering the NRA and its problems. He has a story out today on the trial entitled, “LaPierre, Longtime N.R.A. Leader, Faces Trial That Could End His Reign.”

The article is primarily an overview of the lawsuit from the beginning with nothing new revealed that readers here don’t already know. That is, except for this little tidbit buried in the story.

The attorney general’s office has had settlement talks with Mr. Powell, a person with knowledge of the case said, but no deal has been announced.

That news should not be surprising. Powell has appeared throughout his entire business career to be a survivor despite his many failed business ventures. If his tell-all book was any indication, he will say or do anything in order to survive. Given he is now acting pro se or as his own attorney in this case due to an inability to pay or afford his legal bills, he is the most vulnerable of the defendants in the case. Besides, how much money does the NY Attorney General’s Office realistically expect to reclaim from him. As the old saying goes, you can’t squeeze blood from a turnip.

H/T A.M.

NRA’s New York Trial Delayed Until 2024

NRA In Danger is reporting that the trial for People of New York vs. National Rifle Association is now delayed until sometime in early 2024. It was thought the trial would have started in mid-October 2023.

According to a comment by Frank Tait, it is thought the reason for the delay is the withdrawal of Akin Gump Strauss Hauer & Feld LLP as counsel for Josh Powell. As I noted earlier, they had a parting of the ways over Powell’s ability to pay his legal bills.

One must wonder if this case will ever get to the trial stage. The case is now officially 3 years and 3 days old. I think the only people who are happy about this are the attorneys for the defendants as it gives them even more time to run up their bills with more useless filings.

UPDATE: Stephen Gutowski of The Reload is reporting that Josh Powell intends to represent himself at the trial.

Even as far back as the 1700s, it was thought foolish to represent oneself in court. I wish Mr. Powell well but history has not been kind to those who represent themselves.

NRA Still Wants A Jury Trial In Manhattan

Judge Joel Cohen ordered all the defendants and the New York AG’s Office to give a response on the matter of how the trial should be held. That is, should it be a jury trial or not? The responses from both sides were received this past Friday (July 28th).

Surprisingly, the NRA is sticking to their demands for a jury trial. I am in agreement with NRA In Danger that this is insane. A jury trial for the NRA in Manhattan is the equivalent of a jury trial for Donald Trump in DC meaning a totally unbiased jury pool is virtually impossible to find.

According to the response embedded below, the NRA is asking that a jury trial be held to determine the facts on all the causes of action against the NRA. These would include improper administration of assets, waste, and fiduciary failures. They are claiming they are entitled to this by right. Then, after the jury has determined the facts, the NRA says they would be amenable to having Judge Cohen determine equitable relief. In other words, they want a bifurcated trial with the jury portion coming first.


This is also the position of the attorneys for Wayne LaPierre, Woody Phillips, and John Frazer.

The Attorney General’s Office agrees in part and disagrees in part with the call for a jury trial. Whereas the defendants are saying all the facts should be determined by a jury trial, the Attorney General agrees that should be only for causes of action 2 to 5 and 10 to 14. They contend on the first cause of action as well as causes of action 6 through 9 that they are not triable by a jury under New York law. They present a chart breaking this down found here in the appendix starting on page 9. So in one sense, all involved agree that a bifurcated trial – part by judge and part by jury – is called for. The difference is that the defendants want a jury trial to determine the facts in all the causes of action.

You will notice that the discussion above omits Josh Powell. That is because the attorneys for Powell filed a motion on July 13th to withdraw as counsel. Akin Gump Strauss Hauer & Feld LLP has represented Powell since the beginning of the proceedings. Powell in a separate filing gave his consent to this. A few days later Akin Gump filed motions to keep parts of the reasons for withdrawal under seal or non-public. Judge Cohen has temporarily put these under seal until a hearing can be held on August 7th.

On July 25th, the AG’s office filed a response to Akin Gump Strauss Hauer & Feld LLP’s withdrawal as counsel for Josh Powell. They took no position on Akin Gump’s withdrawal, insisted that Powell get a new attorney sooner than later, and that Judge Cohen should deny the motion to keep keep the reasons for withdrawal under seal. They assert that Akin Gump has not met it burden for sealing their submissions.

Reading closely, the reason Akin Gump and Powell are going separate ways is financial. The AG’s response said, “Powell’s Defense Counsel moved to be relieved, citing Powell’s inability to pay its legal fees.” Now that is interesting.

They also say that Powell should have only 14 days to retain a new attorney given how close the case is to going to trial. If he cannot, they say Powell should act as his own attorney or pro se in legal terms.

So to conclude, the NRA et all insist on a jury trial on all facts, the AG says only on some parts, and Josh Powell seems to have run out of money to pay his legal bills.

NRA Will Not Be Dissolved

Judge Joel Cohen issued a ruling today in the New York Attorney General’s dissolution suit against the National Rifle Association. He dismissed four of the 18 causes of action in the amended complaint brought by Attorney General Letitia James but allowed the remain 14 to continue. Specifically, Judge Cohen dismissed the first, second, 16th, and 18th causes of actions.

The first and second causes of action sought the dissolution of the NRA. In the first cause of action, the NRA was said to have “conducted its business in a persistently illegal manner and abused its powers contrary to the public policy of the State of New York by operating without effective oversight or control by its officers and directors” which was grounds for dissolution under N-PCL § 1109(b)(1). The second cause alleged that “directors or members in control of the NRA have looted or wasted the corporate assets, have perpetuated the corporation solely for their personal benefit, or have otherwise acted in an illegal, oppressive or fraudulent manner.” This would be grounds for dissolution under N-PCL § 1109(b)(1).

He wrote in dismissing those two causes of action:

In arguing for dissolution, the Attorney General’s allegations fail to delineate between the NRA, on the one hand, and its leaders on the other, who acted “without regard to the NRA’s best interests” (see id. ¶ 143 [“LaPierre, together with his direct reports, including Defendants Phillips, Frazer and Powell, instituted a culture of self-dealing, mismanagement, and negligent oversight at the NRA . . . without regard to the NRA’s best interests.”]; id. ¶ 646 [“Despite a conflict of interest and his lack of authority to do so, LaPierre unilaterally determined to place the NRA into bankruptcy to evade a regulatory action in which he was named as a defendant . . . cost[ing] the NRA tens of millions of dollars”]). Conflating the Individual Defendants with the NRA writ large for purposes of dissolution is inappropriate here for the reasons discussed supra. It also ignores the allegations that the wrongdoers in control of the NRA do not necessarily speak for other NRA members, some of whom have tried to instigate reform within the organization but have been met with resistance from entrenched leadership (see, e.g., id. ¶ 491). (emphasis mine)

The 16th cause of action involved the prudent management of institutional funds. This cause of action was dismissed by Judge Cohen as it didn’t properly distinguish between “program-related funds” and “institutional funds”.

The 18th cause of action was specifically against LaPierre, Frazer, Phillips, and Powell. It accused them of common law “unjust enrichment” and sought to recover monies paid to them that were “excessive, unreasonable, and/or unauthorized.” Judge Cohen based his dismissal of this cause of action as it ran afoul of earlier NY Court of Appeals rulings about unjust enrichment. In other words, this was only dismissed due to a technicality.

While the NRA will not be dissolved, this is not to say that the NRA, Wayne LaPierre, and the others are in the clear. The third and fourth causes of action against LaPierre and John Frazer allege breach of fiduciary duty. This was allowed to proceed onwards. Likewise, Judge Cohen found that the allegations contained in the seventh and eighth causes of action which accuse both LaPierre and Frazer of failing to properly administer charitable assets were sufficient to proceed.

The 11th and 14th causes of action were against LaPierre and the NRA respectively. These accuse LaPierre and the NRA of engaging in “unlawful related party transactions.” Judge Cohen found that both claims were sustained.

The 15th cause of action which was allowed to go forward involved violation of the New York whistleblower protections. Judge Cohen said there was sufficient evidence to show that the NRA, Powell, and LaPierre retaliated against whistleblowers and that Frazer was incompetent in carrying out the whistleblower policy. The retaliation against Oliver North as well as the freezing out of directors such as Tim Knight and Esther Schneider from committee assignments is coming back to haunt the NRA.

The final cause of action sustained against the moves by LaPierre and Frazer to have them dismissed is the 17th. That cause of action stated that the NRA and Frazer “made materially false and misleading statements and omissions in the annual reports the organization filed with the Attorney General.” Judge Cohen said that the NRA didn’t contest the falsity of the filings for now and the allegations against Frazer were specific enough that they should continue.

It should be noted that neither Josh Powell nor Woody Phillips sought to have the specific causes of action against them dismissed.

If after all the court proceedings are finished, it could result in the all four of the individual defendants being being barred from the NRA or other New York non-profits and forced repayment of their ill-gotten gains. Moreover, I can foresee a forced restructuring of the NRA in such a way as to prevent the abuses we have seen and are now seeing.

The bottom line is while the NRA has escaped dissolution this is not the end of things.

You can read the full 42-page opinion by Judge Cohen below. It makes for interesting reading.

451625 2020 People of the State of v People of the State of DECISION ORDER on 611 by jpr9954 on Scribd

NRA Settles CarryGuard Debacle With NY State

The National Rifle Association entered into a consent order with the New York State Department of Financial Services today. The Department of Financial Services had charged the NRA with violating New York insurance law with its CarryGuard program as well as with its affiliate insurance programs.

From the NY DFS new release:

Superintendent of Financial Services Linda A. Lacewell today announced that the New York State Department of Financial Services (DFS) has entered into a consent order with the National Rifle Association (NRA). On February 5, 2020, DFS served a statement of charges and notice of hearing to the NRA over violations of New York Insurance Law. That case is now resolved by a consent order that includes a civil monetary penalty of $2.5 million for violations of New York insurance laws.  

In addition, the NRA is banned from marketing insurance in the State or receiving compensation in connection with any newly issued New York insurance policies for five years, irrespective of whether the NRA obtains a license. This brings to a close a three-year investigation. 

In the consent order, DFS found that, despite lacking a license to conduct insurance business in New York, the NRA violated various New York insurance laws and regulations by, among other things, acting as an insurance producer without a license in participating in efforts to solicit and market the sale of insurance products, including the NRA’s Carry Guard insurance program. 

“The NRA operated as an unlicensed insurance producer and broke the New York Insurance Law by soliciting insurance products and receiving compensation,” said Superintendent Lacewell. “Even worse, the NRA violated the New York Insurance Law by soliciting dangerous and impermissible insurance products, including those within its Carry Guard program that purported to insure intentional acts and criminal defense costs. The Department will continue to protect the integrity of the insurance market for the purposes of safety and soundness and the good of all consumers.” 

The CarryGuard program was rushed into the market under the management of former Executive Director of General Operations and former Chief of Staff Josh Powell. As I understand it, his predecessor Kyle Weaver, then Director of General Operations, was building the program out step by step which wasn’t fast enough for the powers that be. The thought behind the program was that the NRA had helped get shall-issue concealed carry introduced in many states. However, they saw groups like USCCA offering legal defense programs which the NRA saw as making money off their hard work and they wanted in on it.

Then, Powell replaced Weaver and rushed the product to market with big fanfare at the NRA Annual Meeting in Atlanta. That rush has now cost the NRA $2.5 million it can ill afford to spend.

In a story from Reuters on this consent order, NRA outside counsel William Brewer III tries to put a positive spin on it.

The NRA has said it did not underwrite its insurance programs, and that like “countless” affinity groups it relied on industry experts to market products to members.. It did not admit wrongdoing in agreeing to settle.

William Brewer, a lawyer for the NRA, said in a statement: “The DFS inquiry, which began with a roar, ends with a whimper.” He said the settlement has no effect on other litigation pending between New York state and the NRA.

That story also has this from Superintendent Lacewell regarding the other insurance offered through the NRA.

She also accused the NRA of misleading gun collectors, dealers, instructors, clubs and shows by promising coverage at the “lowest possible cost,” when the group typically kept between 13.7% and 21.9% of premiums paid.

This Was Supposed To Be The Big Day for Josh Powell

If you had been paying any sort of attention to the mainstream media, you might know that today was the day that Josh Powell’s tell-all book was to be released. The book entitled, Inside the NRA: A Tell-All Account of Corruption, Greed, and Paranoia within the Most Powerful Political Group in America, is supposed to tell us the inside scoop about Wayne and company.

Amazon is running this as the blurb for the book:

A shocking exposé of rampant, decades-long incompetence at the National Rifle Association, as told by a former member of its senior leadership.

Joshua L. Powell is the NRA–a lifelong gun advocate, in 2016, he began his new role as a senior strategist and chief of staff to NRA CEO Wayne LaPierre.

What Powell uncovered was horrifying: “the waste and dysfunction at the NRA was staggering.”

INSIDE THE NRA reveals for the first time the rise and fall of the most powerful political organization in America–how the NRA became feared as the Death Star of Washington lobbies and so militant and extreme as “to create and fuel the toxicity of the gun debate until it became outright explosive.”

INSIDE THE NRA explains this intentional toxic messaging was wholly the product of LaPierre’s leadership and the extremist branding by his longtime PR puppet master Angus McQueen. In damning detail, Powell exposes the NRA’s plan to “pour gasoline” on the fire in the fight against gun control, to sow discord to fill its coffers, and to secure the presidency for Donald J. Trump.

ABC News’ Pierre Thomas had an exclusive interview with him. It was so earth-shattering that they ran it on Friday on World News Tonight, on Sunday with George Stephanopolous, and again on Monday on GMA.

Powell described himself as a “huge Second Amendment supporter” with a sizable gun collection and a lifelong passion for hunting and shooting. As the NRA’s “No. 2 guy,” he said he “worked side by side” with LaPierre over several years. An NRA spokesperson, in a statement, said that Powell “had zero input or influence on the NRA’s political or legislative strategy,” but Powell says he was involved in “every single important conversation that went on in the NRA.”

But he became disillusioned with the organization and LaPierre’s leadership, he said, as LaPierre’s alleged misuse of members’ money came into focus. Powell says his work became “soul-sucking,” and he now considers it a “low point in [his] life.”

Danny Hakim of the New York Times reported that Powell is now calling for red flag laws and universal background checks.

A hunter since childhood and former Chicago options and derivatives trader, Mr. Powell says that the N.R.A. has fundamentally lost its way, abandoning “its roots as an organization focused on gun safety and education.” That has led it to limit its own long-term membership growth, he argues, by turning its back on the majority of gun owners who support background checks.

With this kind of build up plus dishing all the dirt on Wayne LaPierre and the NRA, you would think the New York Times Review of Books would give it a glowing review just to get Powell’s narrative out there.

And…you would be mistaken.

The review of the book was brutal. It starts off with this:

This is a sad book, and a bad one, and you shouldn’t buy it. The thinking in it is poor; the writing is worse. The author “exposes” evils that, if you’ve been paying even scant attention, you already know. Expect it soon in a Walmart remainder bin near you.

I had always assumed that Powell had a ghostwriter. Given the review of the writing style, I might be mistaken on that. Either that or he had the worst ghostwriter that money could buy.

It gets worse.

The unrelenting barrage of clichés is worse. The N.R.A. has debased the American language, and Powell adds to the sludge. If you only skimmed this book, you would think it was about a fox in a henhouse who caught flak and was thrown under a bus for playing laser-focused hardball like gangbusters and getting the short end of the stick while sensing blood in the water.

It concludes:

Powell’s book is a mea culpa. About the N.R.A.’s Kool-Aid, he writes, “I sold it, stirred it, drank it every day.” He lost his soul, he writes, and became part of the swamp. He’d like, he claims, again unconvincingly, to see the N.R.A. largely return to its roots as an organization dedicated to gun safety.

The N.R.A., in this telling as in others, is an organization in free fall. About New York’s attorney general, Letitia James, who has taken existential aim at the N.R.A., he writes, “I’m not betting against her.”

Bearing in mind that Powell is one of the four named defendants in the suit brought by Letitia James and because he appears to be a sociopath willing to do anything to save his own skin, I’m guessing he has already rolled over and is providing James all the gossip.

You might remember I noted that Powell’s attorney is a partner at Akin Gump. I had wondered how a guy without a job could afford such an expensive attorney. Five years ago the reported partner billing rate for the firm was over $1,200 per hour and undoubtedly is higher now. I might have an explanation for that. A friend who is a DC attorney said that lots of the big DC firms will take cases like this pro bono in exchange for the publicity.

It is either that or perhaps a former big city mayor who hates the NRA enough has decided to foot the bill so that even more dirt about the NRA is released just prior to the election. Nah, that would make me look like a conspiracy theorist or something.

Finally, if you are wondering how such an incompetent grifter ever got hired to a high position at the NRA, my sources say that the blame falls on Pete Brownell and Wayne’s former BFF Tony Makris. Sometime after Powell was elected to the NRA Board of Directors, they pitched him to Wayne as someone for his executive team. The rest is history as the saying goes.