Within hours of a Texas federal judge’s dismissal of the National Rifle Association’s bankruptcy case—part of an effort to get the organization out of New York State and re-established in the Lone Star State—a billionaire-backed gun prohibition group in Seattle was calling it a “HUGE blow to the already-beleaguered NRA.”
The Alliance for Gun Responsibility was out with an email blast declaring the decision by Federal Bankruptcy Judge Harlin D. Hale “means that the flailing organization will have to continue defending itself against additional litigation from former vendors, donors, and the DC Attorney General.”
The anti-gun group also are trying to exploit the court ruling to raise funds.
NRA earlier this year filed for Chapter 11 bankruptcy protection which LaPierre at the time explained was part of a legal strategy to get NRA out of New York State.
In his decision, Judge Hale hit the 5-million-member association hard stating, “The Court finds that the NRA did not file the bankruptcy petition in good faith because this filing was not for a purpose intended or sanctioned by the Bankruptcy Code.”
Later in the ruling, Judge Hale also observed, “The Court finds that the NRA did not file the bankruptcy petition in good faith because this filing was not for a purpose intended or sanctioned by the Bankruptcy Code. Therefore, cause exists under section 1112(b) to dismiss this case, which the Court finds is in the best interests of creditors and the estate.
“The Court is not dismissing this case with prejudice,” the judge said, “but should the NRA file a new bankruptcy case, this Court would immediately take up some of its concerns about disclosure, transparency, secrecy, conflicts of interest of officers and litigation counsel, and the unusual involvement of litigation counsel in the affairs of the NRA, which could cause the appointment of a trustee out of a concern that the NRA could not fulfill the fiduciary duty required by the Bankruptcy Code for a debtor in possession.”
Alan Gottlieb, chairman of the Citizens Committee for the Right to Keep and Bear Arms, told The Outdoor Wire, “It was not unexpected. They might be lucky the judge did not take the case and appoint an outside receiver to run it.”
He does not see a good outcome from filing for bankruptcy.
New York State Attorney General Letitia James filed a federal lawsuit last August, alleging NRA officials had diverted millions of dollars “to fund luxuries” including expensive vacation and hunting trips, flights on private jets and other expenses. In her lawsuit, she is seeking to dissolve the 150-year-old organization.
Meanwhile, NRA has posted its perspective on the ruling at its website.
“The NRA remains committed to its members and our plan for the future,” said NRA CEO and Executive Vice President Wayne LaPierre in the story. “Although we are disappointed in some aspects of the decision, there is no change in the overall direction of our Association, its programs, or its Second Amendment advocacy. Today is ultimately about our members – those who stand courageously with the NRA in defense of constitutional freedom. We remain an independent organization that can chart its own course, even as we remain in New York to confront our adversaries. The NRA will keep fighting, as we’ve done for 150 years.”
NRA has maintained James’ investigation and lawsuit are politically motivated, as noted by a report in AmmoLand News.
James held a telephone press conference with reporters after the ruling was released. Liberty Park Press listened in, but was not able to submit a question. She will pursue accountability and restitution of allegedly misspent NRA funds.
In her remarks, James vowed to press her case, which is still in the discovery process. She said that continues into early 2022 and eventually there will be a trial.
In its story, NRA said it can “still pursue establishing business operations in Texas, and the organization will continue to explore moving its headquarters there from Virginia. Texas is home to more than 400,000 NRA members.”
Meanwhile, in its email blast to supporters, the Alliance for Gun Responsibility quickly tried to raise money, claiming it needs the funds to continue its gun control lobbying effort.
“This decision means that the New York Attorney General’s case seeking to disband the NRA can proceed,” the message says. “And it means that the flailing organization will have to continue defending itself against additional litigation from former vendors, donors, and the DC Attorney General.
“We have been fighting the NRA for years,” the Alliance declares, “now we have the chance to stop them once and for all.”
The organization also describes NRA as having “abandoned its original mission as a sportsman and firearm safety organization. They have fought any and every gun safety measure, sowing fear and hate at the expense of American lives.”