Not Good Signs For NRA

The blog NRA In Danger is reporting on two more indicators of trouble for the NRA.

First is regarding the NRA Annual Meeting scheduled for Labor Day Weekend in Houston. They report that only half of the booth space has been rented out with little more than a month to go. That in and of itself isn’t good. They also note that organizations like the Second Amendment Foundation which have traditionally had booths at the Annual Meeting are turning down the “opportunity”. I had known that and was told by my friends at SAF that they considered it a “waste of money” to be there.

The second is even more disturbing. It concerns upkeep of the NRA headquarters building in Fairfax. Even when not occupied or lightly occupied, you still have to do the upkeep or the building falls apart.

Second, the headquarters building is being allowed to deteriorate. Rain is penetrating the roof, sometimes pooling on the floor and running through passages through floors to soak lower stories. Most of the surviving employees are still working from home, so this is a building that has largely been unoccupied for over a year, and over two summers. Likely a major mold problem will follow, if it isn’t there already. There is money enough for tens of millions in legal fees, but no money to fix the headquarters roof.

NRA in Danger speculates that the board is unaware of these issues as they are being kept in the dark by Wayne and the rest of the Gang of Four. If so, it is malfeasance on the part of the leadership and a continued refusal by the board to do their fiduciary duty of care.

Four Good Reads On NRA Bankruptcy

Bitter and Sebastian at Shall Not Be Questioned have been part of the gun blogosphere for a long, long time. While not as active as they used to be, they are still astute observers of all things NRA.

Bitter has a wonderful fisking of the NRA’s public response to Judge Hale’s dismissal of their bankruptcy case.

She concluded:

In general, this public response highlights that it’s time for Wayne to go, along with most of the yes men he has put into place. This is an embarrassment to the organization, especially as anyone remotely literate can read what the judge really said.

The blog NRA In Danger also provides a brutal fisking of the NRA’s public statement. They may be the new kids on the block in terms of blogging but whoever is writing the blog has a deep, insider knowledge of how things actually work at the NRA.

When a bankruptcy judge who has been on the bench many years, and “seen them all,” says conduct shocks him, you’re hearing it from an expert.

NRA CEO & EVP Wayne LaPierre said today’s decision – and the ongoing independence of the NRA – empowers the Association’s approximately 5 million members. 

If the suit being dismissed empowers the members, does that mean that winning the suit would have dis-empowered them?

“We will never shrink from the tough and principled stands we take”

I’m getting too nauseous to continue. Hitler in his bunker was less delusional.

We had better enjoy the NRA annual meeting in four months, because it will probably be the last annual meeting. Anyone on, or getting elected to, the board, had best face the fact that they face lifelong dishonor as a member of the board that killed this fine organization. NRA has had men who held the Medal of Honor on its board, but they have been replaced by people who tremble at the thought just of dissenting. Let the leadership go insane and destroy the 150-year-old organization, these directors would rather not grow a spine.

Frank Tait, who I supported in his efforts to win a seat on theBoard and who I will be writing in for election to the Board, looked at the bankruptcy effort from a business perspective. He, after all, has been in managerial positions for many years.

“So why did you file? We can only guess that the lawyers saw the prospect of a wealthy client who wasn’t adverse to paying big fees, and thought of nothing else. Not even the most core ideas: 1. What do we want from the court? 2. is that something the court can legally give us?”

In my 40 years in business, I’ve been involved in multiple legal disputes. There is critical mindset to legal matters. THE LAWYERS WORK FOR YOU, not the other way around. The secondary mindset is risk-reward considerations, or as a former CEO liked to say “is the juice worth the squeeze.” Both of these key mindsets appear absent from the EVP and the Officers of the Board – and the remainder of the board is not asking the tough questions that are their fiduciary obligation.

Finally, Georgetown Law professor Adam Levitin has been following the case from the start. He may not be aware of the inner dynamics of the NRA but he wrote the textbook on bankruptcy law. His verdict on the filing from a legal standpoint is that it was a fool’s errand from the start.

The NRA’s bankruptcy petition was dismissed as filed in bad faith. I’m predicting that the court’s opinion will be in the next edition of every bankruptcy textbook as the case really is a textbook example of bad faith.  The court found that there was substantial evidence in the record that the NRA filed for bankruptcy for the purpose of gaining an advantage in its litigation with the NY Attorney General, namely depriving the NY Attorney General of the remedy of dissolution, rather than for any other purpose.  

He notes he’d be surprised if the NRA appeals or refiles. Moreover, he wonders if the creditors’ attorneys will file a sanctions motion against either the NRA or its attorneys for reimbursement of their litigation costs given the bad faith filing ruling.

Read all four of these blog posts. They all take a different approach but all conclude the whole bankruptcy filing was a fiasco.

NRA Reorganization Plan

The attorneys for the National Rifle Association filed this reorganization plan with the US Bankruptcy Court for the Northern District of Texas on Sunday. I assume that it was approved by the NRA Board on Saturday. I say assumed as no word has come out of those meetings on whether it was passed, what the vote was, or anything else.

I have listened to some of the closing arguments in the case today. I missed the NY Attorney General’s closing argument but I have read that they pushed for dismissal. I did parts of the arguments of the attorney for Judge Phillip Journey and other board members as well as that by Lisa Lambert who is the US Trustee. Both argued for the appointment of an examiner with special powers. Ms. Lambert was especially forceful that the examiner have the power and the money needed to do the job. They both argued against the Chief Restructuring Officer.

I have only briefly scanned through the reorganization plan. However, from what I’ve seen it just moves the NRA to Texas, leaves the existing board in place, and says members now will be members in the Reorganized NRA.

If you do have the time to read through this and see something, please add you observations in the comments.

NRA Reorganization Plan by jpr9954 on Scribd

For Your Weekend Reading

The NRA Board of Directors is having a special meeting today in Dallas along with a regular meeting tomorrow on Sunday. The special meeting is to approve the reorganization plan and the Chief Restructuring Officer. This comes on the heels of the last day of testimony in the US Bankruptcy Court hearings.

Day 10, as reported by the blog NRA In Danger, had testimony from the NRA’s outside auditor and the proposed Chief Restructuring Officer as well as cross-examination of Wayne LaPierre. While there is a lot there and you should read it in its entirety, three things captured my attention.

This witness did not do well under cross examination. He argued he’d reformed everything, then was faced with improper events that occurred after his alleged reforms. His choices were to appear corrupt or to appear incompetent and out of control, and he went with the second choice.

That to me provides even more evidence to Judge Harlin Hale that perhaps a trustee is called for. As those who are no fans of Wayne but are really worried about the future of the NRA have observed, a trustee would have the power to convert the Chapter 11 into a Chapter 7 and dissolve the NRA.

The second thing that captured my attention was Wayne’s response to the NRA’s attorney Greg Garman when asked about his background and history.

Background. MA from Boston College in politics, VA legislature. Got Phd. Over at DNC, knew NRA people, NRA right across street. Went into NRA building, they offered me job, late 1977. State liaison for year, then director state local. 1 year, then head govt affairs, in 1980. Membership now 4.9 million. Tried convert NRA into freedom organization. Outreach to celebrities. Celebrity shoots in Hollywood, dinners, etc.

Wayne does not have a PhD. He may have been in a PhD program in political science at BC but he never earned a PhD. I was admitted to the PhD program in political science at UNC-Chapel Hill. However, I left with a wife and no degree. I would never, ever, claim to hold a PhD if I hadn’t earned it. It just isn’t done and is consummately tacky.

Finally, there is Judge Hale’s question that he ordered the attorneys for both sides to answer on Monday. Judge Hale may be nicknamed “Cooter” but he is no fool.

Judge asks question, to be answered in arguments Monday (no court Friday)—chapter 11 purpose is to save company from liquidation bankruptcy. Does court have jurisdiction where sole purpose is to save company from dissolution under state law, which dissolution will only occur if the state court concludes dissolution is in best interests of public?

The blog NRA In Danger examines Judge Hale’s question in more detail. It is the critical question: does the court have jurisdiction? If not, then the case must be dismissed and the NYAG is free to continue in her attempt to dissolve the NRA.

Her dissolution suit has been strengthened by the bankruptcy court revelations. Just the lad day of testimony saw Wayne LaPierre claiming that he’d begun cleaning everything up in 2017, but forced to admit that he’d been given an incredibly lucrative “golden parachute” agreement in mid-2018 (it would have given him many millions had the board ever stopped electing him) that was signed by an outgoing president and Carolyn Meadows, now NRA president and head of the board’s Special Litigation Committee. The signing of the contract implicates NRA’s current board leadership, and also LaPierre himself, and shows his supposed 2017 reforms are. sham. He himself is free to loot despite them. On the same day those board officers signed another golden parachute for Woody Phillips, the NRA treasurer who had to “take the Fifth” dozens of times in his testimony. Others who got such agreements, LaPierre testified he had no idea of the contracts, showing that even if he were honest, in practice others are free to loot NRA at will without his being able to discover it.

Read the whole thing.

Moving on, a column by Stephen Gutowski on his new platform The Reload examines what he calls the membership program. In 2013, Wayne promised to double the membership after it had just hit five million members. Membership now stands at 4.89 million members. Not only has membership not doubled under Wayne’s most recent watch but it has regressed.

If the NRA’s membership has hit a ceiling, that’s significant, and it’s a bad sign for the most influential gun-rights group on the planet. It’s also a bad sign for NRA leadership’s argument in their current argument in the bankruptcy case. NRA leadership has repeatedly argued the LaPierre is the driving force behind fundraising at the organization, and it could not operate anywhere as effectively without him. But LaPierre has not only failed to meet his self-set 2013 goal of doubling NRA membership; membership has actually receded by his own account.

There are millions of new gun owners out there. I imagine some may have joined the NRA this year but the majority have not. Moreover, if what I’m reading across the Internet in forums on hunting, on the Second Amendment, and the like is correct, then there are a lot of people refusing to renew memberships or to make donations so long as Wayne and his grifter cronies remain in power. I am hearing this from both Gun Culture v1.0 and 2.0. I know my own wallet will remain closed to the NRA so long as Wayne is there.

Finally, my friend Kevin Creighton has an excellent post about the NRA’s fund raising approach. He notes Stephen Gutowski’s column on the NRA’s negative growth and relates it to their fund raising approach.

However, let’s face facts. For over 10 years now, the NRA’s primary messaging has been “Give us money, they’re a-comin’ for yer guns.” Okay, fine, let’s say they actually ARE coming for our guns. What have you, the NRA, done to prevent that from happening? What value am I getting for my donation? Why should I give to you right now, except out of habit?

Kevin relates his success fund raising for a faith-based organization using a positive approach. He urges the NRA to get away from the negative approach and return to the more positive approach of the past. Then, both money and membership might grow.

If you are a NRA member or were at one time, you really need to read all these blog posts and articles. Those of us who want a reformed NRA may be voices crying in the wilderness like the Old Testament prophets but the fight for the Second Amendment depends upon it.

Another NRA Board Special Meeting

Stephen Gutowski of The Reload is reporting that a special meeting of the Board of Directors has been called for May 1st in Dallas. The purpose of this meeting is to approve a reorganization plan that the NRA plans to present to the US Bankruptcy Court.

They plan to have a regular Board meeting on Sunday, May 2nd.

This meeting comes after two weeks of testimony before Judge Hale in the US Bankruptcy Court. As Gutowski, myself, and others have noted, this testimony has brought out many questionable financial practices involving Wayne LaPierre, his executive assistant Millie Hallow, and former CFO Woody Phillips.

As Gutowski notes regarding the meeting:

The NRA did not respond to a request for comment on the special board meeting, but there is a possibility the meeting won’t even take place. The current portion of the bankruptcy trial is set to end on April 23, and the judge is supposed to issue an order in the case by April 30. If the judge decides to appoint a trustee or dismiss the case, it is possible the group won’t have an opportunity to present the restructuring plan the board is set to review on May 1. A trustee could also fire current leadership and the board of directors before the meeting occurs.

The US Trustee has objected to the appointment of a Chief Restructuring Officer as proposed by the NRA. The US Trustee noted that the CRO would report to Wayne and the Special Litigation Committee composed of Meadows, Cotton, and Lee. Thus, the CRO would not be independent and could not be independent without bylaw changes by the NRA.

As the blog NRA In Danger points out:

The US Trustee did a better job of reading NRA’s Bylaws than did NRA’s attorneys. He points out that the CRO might be an NRA officer and the Bylaws say only the members can create a new NRA officer,

“It is not clear whether the NRA’s bylaws permit the creation of a chief restructuring officer position. The NRA’s most recent Bylaws incorporate input from the NRA’s membership and confer limited authority to officers and committees. The NRA’s Bylaws state that certain “AMENDMENTS IN BOLD FACE ITALICS SHALL NOT BE REPEALED OR AMENDED BY THE BOARD OF DIRECTORS.” Instead, Article XV, Section 4, reserves authority to amend bylaws in bold and italics to the NRA’s membership. Article V, Section 1(b), describes the specific officer positions, and in bold italics, states “The Board may not abolish said offices nor create any other offices.” 

There is another hearing scheduled before Judge Hale this afternoon at 4pm CDT. It will be interesting to hear what comes out of that meeting.

You will note that I did not say that Stephen Gutowski is with the Free Beacon. He left them on Friday and is now out on his own with The Reload. I would urge you to check it out and subscribe if you think it worthwhile. I did and I’m looking forward to his continued reporting on all things gun-related.

A New Must Read Blog

A friend sent me a link to a new blog called, “NRA in Danger.”

Having read all of their postings, I’d say it is a must-read blog especially for any NRA member who is concerned about the bankruptcy filing, the organization’s future, and the shenanigans played by Wayne and company. I don’t know who is writing this blog but I have found their reporting on the NRA’s bankruptcy hearings astute and incisive.

Here is how they describe themselves:

We are a group of NRA members, all life or above, who are concerned about where our organization is being taken. In 2019, the 150 year-old NRA, the oldest civil rights organization in the country, was rocked by financial scandals. The New York Attorney General (It’s a New York corporation) sued to dissolve its corporate charter, to kill it as a corporation. Since then its leadership and Board of Directors has consistently made the worst possible decisions, feeding her ammunition. A good move would have been to announce it was concerned about the allegations, was going to seriously investigate, and remove or otherwise punish those responsible. She’d have had no case then, yes there were problems, and NRA’s board is curing them.

Instead, the choice was to purge those who supported an investigation, threaten any who might join them, cover up everything, keep those responsible, and hand them big bonuses. Members were told that nothing was wrong, her case was all lies and posed no danger. Then the Board filed for bankruptcy, spending millions to escape from that supposedly harmless suit.

The members deserve truth, and we will do our imperfect best to give it to them.

We can be contacted at: NRAlifer -at- protonmail.com

I have only listened to some of the bankruptcy hearings. However, this one part from Day Five which included testimony from Judge Phil Journey just infuriated me.

At board special meeting in March, he was told his motion made him an enemy of NRA’s position. Charles Cotton asked that anyone adverse to NRA not attend executive session, while staring at him. He attended anyway. Got up to speak at microphone, chair ignored him, refused to call on him and he eventually sat down. When they went back into open session he asked to speak on a point of personal privilege, his honor had been impugned, and people shouted him down and Willis Lee, 2nd VP and chair, ruled him out of order. So he was prevented from speaking to the rest of the board about the issues and why he had filed.

A majority of the Board and especially the leadership are acting like petulant children. Their actions are more reminiscent of the behavior of members of the Soviet Politburo towards someone who had fallen out of Stalin’s favor.

I will freely admit that I was taken in by Willes Lee. I endorsed him not once but twice. I regret ever urging anyone to vote for that snake in the grass. The best I can say in my defense is that Willes was very good at cozying up to and playing members of the Second Amendment new media. That is, until he got what he wanted. Now we are yesterday’s news and treated like untermensch.