SEATTLE – A judge has essentially put the Northwest chapter of the American Lung Association out of business after the chapter got into hot water for giving its Seattle headquarters and $600,000 to a different, newly created charity.
In an order Monday, King County Superior Court Judge Regina Cahan said the American Lung Association was likely to win its claim that the regional affiliate breached its contract.
The judge issued a preliminary injunction that forbids the Northwest chapter and the newly created charity from using American Lung Association donor lists or spending money except for legal fees. They can’t even use the word “lung” anymore in their business names or when dealing with the public, she said.
Cahan said her order would not take effect until the national organization posts a $500,000 bond, but the actual cash required is expected to be a very small percentage of that, and the American Lung Association said it would have no trouble coming up with the money.
“We’re very pleased,” said Carrie Martin, a spokeswoman for the national organization. “We’re hopeful the Northwest affiliate does the right thing so that further litigation can be avoided.”
Meanwhile, the national organization is taking steps to replace its Northwest chapter, which was founded in 1906 and has been charged with carrying out the charity’s mission in Alaska, Idaho and Washington, including teen anti-smoking efforts, support of indoor smoking bans and fundraising bike rides and mountain climbs.
It’s unlikely any board members from the Northwest chapter will be retained, but many staff members could be, Martin said.
The dispute began in late summer, after the Northwest chapter’s new chief executive, Mike Alderson, joined two other people, including the former chief executive of Harborview Medical Center, in creating a charitable organization called the Pacific Northwest Lung Cancer Foundation. Alderson persuaded the chapter’s board to give his new foundation the Northwest chapter’s one-story, brick headquarters building – assessed at $3.2 million – for just $10.
He also persuaded the board to give the new foundation $1.2 million – $600,000 immediately and $600,000 later – to help get it off the ground. The new foundation’s goal was to do high-caliber fundraising that would benefit not only the Northwest chapter, but other organizations devoted to lung health, he said.
The national organization sued, saying the regional chapter was giving away its assets – raised to support the ALA’s mission – to a competing fundraising organization with no promise of getting anything in return.
Cahan’s order does not end the lawsuit. The newly elected judge, handling her first civil case, set a trial for June 1, and she ordered both sides to enter mediation by Feb. 15 in hopes of resolving the case before then. She prohibited the new foundation from selling or transferring the headquarters building.
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