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NRA Files Answer In NY AG Lawsuit

It answers the latest amended complaint (amended to add in all the material discovered during NRA’s disastrous bankruptcy filing). Reading it, you should understand that “the document speaks for itself” means “yes, it says that,” and mumbling about how depositions taken over the internet during covid wearing masks (!!) might be incorrect means “yes, LaPierre admitted that.”

Para. 213: “The NRA admits that in certain instances during 2018, McKenna received payment for services not covered by its then-existing contract. The NRA further admits that during the time period alleged, certain invoices were paid without confirmation of a formal written contract.”

Para. 215. “The NRA admits that the EVP Consulting Budget has, from time to time, included consulting arrangements with former NRA presidents and other board members. The NRA further states that the details of such consulting arrangements, their documentation, and their approval or ratification by the Audit Committee varied over time.”

Para. 222. “The NRA admits that in the wake of the Parkland tragedy, following advice from Angus McQueen that a “safe house” should be established, Mr. LaPierre and his wife reviewed several properties selected by Ackerman McQueen’s real estate broker. The NRA lacks knowledge or information sufficient to form a belief as to the accurate market valuation of the property [$6 million of NRA members’ money], and denies the allegations in Paragraph 222 regarding the same. The residences visited included a home in Westlake, Texas. The NRA lacks knowledge or information sufficient to form a belief as to the accurate market valuation of the property and denies the allegations in Paragraph 222 regarding the same.”

Para. 225. “The NRA admits that an Ackerman McQueen executive sent an invoice from WBB Investments LLC in the amount of $70,000 bearing the referenced annotation.”

Para. 228. “The NRA admits that it issued a check to WBB Investments, LLC in the amount of $70,000, and that shortly thereafter, the NRA communicated that it did not intend to proceed with the transaction and the funds were returned.”

Para. 234. “The NRA admits that it made payments to HomeTelos LP between 2014 and 2017 and admits further that Mr. Phillips (its treasurer) later disclosed a personal friendship (they were lovers) with an executive of HomeTelos or an affiliate. The NRA states that its transactions with HomeTelos were ratified by the Audit Committee of the NRA Board following Mr. Phillips’ disclosure.”

Para. 235. “The NRA admits that on or about September 2, 2014, Mr. Phillips executed a contract with HomeTelos LP on behalf of the NRA. The NRA states that neither Mr. LaPierre nor any other NRA officer signed the contract or participated in its negotiation.” The treasurer could steer major money to his lover without anyone else knowing.

Para. 245. “To the extent that Paragraph 245 purports to characterize the content of a purported post-employment consulting agreement propounded by Mr. Philips, the NRA states that such agreement speaks for itself.” Yes, it’s true.

Para. 269. “The NRA admits that McKenna performed consulting services for the NRA since at least 2012, and that such services included donor-cultivation work. The NRA admits that in July 2017, it entered into an amended contract with McKenna that provided for a $20,000 monthly consulting fee.”

Para. 283. “The NRA admits that in or around June 2018, it made a payment to a former employee totaling $89,000 and obtained a release of existing and potential claims.”

Para. 288: “The NRA admits that Mr. Frazer returned to the NRA in January 2015 full-time as its General Counsel and received a salary that year of $272,576 with additional compensation of $55,870. [Pretty good for a kid with 14 months’ experience in practicing law and none doing it for a $350 million/year corporation]. The NRA states that the Board approved a salary increase to $360,000 in September 2017 which took effect in 2018, with a bonus of $54,100 paid in 2018. The NRA denies the remaining allegations set forth in Paragraph 288 of the Complaint.”

Para. 298. [Now we get into Millie Hallow, a convicted embezzler whom LaPierre hired as his ‘right hand”] The NRA admits that it employs multiple senior staff members who liaise with Mr. LaPierre, attend management meetings and Board meetings, and represent the NRA around the country. The NRA admits that one such staff member has a salary of approximately $250,000. The NRA admits that the referenced Senior Staff Member has held various job titles, but denies that she has always and exclusively reported to Mr. LaPierre.

Para. 299. The NRA admits that it conducted an internal investigation in or about 2003, and states that the independent professionals who conducted the investigation “cleared” the staff member of wrongdoing.

“The NRA admits that in 2012, roughly $18,000 in expenses were incurred at the direction of a senior staff member, and states that such expenses were subsequently reimbursed to the NRA with interest.” [She was caught ripping off NRA].

Para. 325. “The NRA admits so much of Paragraph 325 as alleges that Ackerman regularly passed expenses without justification or appropriate backup.”

“The NRA admits that Ackerman typically billed the NRA for purported out-of-pocket expenses, and further admits that the invoices for such expenses were generally transmitted to the NRA unaccompanied by explanatory details or supporting documents.”

Para. 333: “The NRA admits so much of Paragraph 333 as alleges that Ackerman paid $ 4,000 a month for some years to II&IS [LaPierre’s personal travel agent] for travel services and passed those expenses on to the NRA.”

Para. 344; “The NRA admits so much of Paragraph 344 of the Complaint as alleges that Under Wild Skies, Inc. (“UWS”) produced a television program as described therein, and that the NRA paid UWS over $18 million.”

Para. 345 “The NRA admits that UWS was paid approximately $1,957,500 in 2019 by the NRA.”

Para. 347. “The NRA denies knowledge or information sufficient to form a belief as to the truth of the allegations set forth in Paragraph 347 of the Complaint, except admits that various NRA officers, directors, spouse(s), and the Executive Director of Advancement participated in hunts that appeared on Under Wild Skies.” Were taken on safaris at NRA expense.

Para. 349. “The NRA admits so much of Paragraph 349 of the Complaint as alleges that the NRA paid UWS close to $50,000 a month for supplemental invoices.”

Para. 370. “The NRA admits that H.W.S. Consulting [the company owned by Wayne Sheets, former head of the NRA Foundation] was reimbursed for certain expenses during 2016.”

Para. 372. “The NRA admits that it entered into an incentive compensation agreement to which Lockton Affinity and a former NRA employee were participants. The NRA further admits that Lockton Affinity served as a broker for many NRA-related affinity insurance programs, including Carry Guard.” So one of the NRA employees was also being paid by an NRA vendor, whom he supposedly was overseeing.

Para. 398. “The NRA admits that, at certain relevant times, one of its board members received $4,000 per month for public speaking and consulting services.” So at least one director was being paid very well, for a supposedly non-paying jon.

Para. 409. “The NRA denies knowledge or information sufficient to form a belief as to the truth of the allegations set forth in Paragraph 409 of the Complaint, except admits that a Board Member is a past NRA President, who has been paid at various times for consulting services, and executed a contract for $220,000 annually.” Marion Hammer, being paid very well while a director. A bought vote on the board.

Para. 472. Attorney Brewer was retained in March 2018.

Para. 483. “The NRA admits that Mr. LaPierre [who is nominally an “employee”] instructed North [who is nominally the “president”] to cease and desist from attempts to interfere with certain work by the Brewer firm—including work related to North’s employer, Ackerman—that gave rise to overt conflicts of interest for North (such legal matters, the “Conflict Matters”). The NRA denies that it prevented North from accessing Brewer invoices unrelated to the Conflict Matters, and states that North received detailed briefings from the Brewer firm on matters apart from the Conflict Matters [in other words, he got briefed on anything except for paying the Brewer firm].

Para. 488. “The NRA admits that as of the date of this Answer, North did not resign as an NRA member or NRA director. The NRA further admits that its Bylaws contemplate a process for involuntary termination from membership for cause. The NRA further admits that, in response to an Amended Complaint by an NRA member in good standing seeking the expulsion of North from the NRA membership pursuant to Article III Section 11 of the NRA’s Bylaws, the Ethics Committee of the NRA Board reviewed the complainant’s allegations and determined that they warrant North’s expulsion if proved or were not contested. The NRA further admits that North through counsel was then advised that at the hearing, contemplated by its Bylaws, the complainant NRA member would be permitted to argue for North’s expulsion from the NRA and North would be permitted to defend himself. The NRA further admits that North originally requested to have a hearing but later alleged that the hearing would violate New York law and that the NRA then sought, inter alia, a declaratory judgment, and that such litigation is ongoing but presently stayed. In that litigation, the NRA also seeks damages from North for violations of his fiduciary and statutory duties to the NRA and for his conspiracy with others to violate such duties. The NRA further admits that the NRA asserted these claims against North based on his obstructive behavior to protect a lucrative contract with Ackerman and impede the NRA’s compliance efforts and by being paid millions of dollars for making a documentary series he and Ackerman failed to deliver. In the litigation, the NRA also seeks a declaratory judgment that because North failed to resign from Ackerman in or around June 2019, he forfeited his position on the NRA Board. The NRA denies the remaining allegations in Paragraph 488 of the Complaint.”

Para. 510. “To the extent that Paragraph 510 purports to characterize the Report of the Audit Committee dated September 2018, the NRA states that such document speaks for itself. The NRA respectfully refers the Court to such document for its complete, accurate contents; to the extent that the allegations in Paragraph 510 are inconsistent with the referenced document, the NRA denies them. The NRA admits that certain previous Audit Committee reports contained the notation “there were no instances of whistleblowing reported,” and that no such annotation appeared with respect to the July 30, 2018 meeting, wherein whistleblowing occurred.”

In other words, the Audit Committee got the whistleblower complaints, and instead of informing the board, it just omitted the usual sentence saying none had been received. The Audit Committee became part of the cover-up.

Para. 579. “The NRA admits that its [IRS] Form 990 was in past years signed on behalf of the NRA by the NRA’s Treasurer and CFO and that its Treasurer and CFO did not sign the NRA’s Form 990 for year ending December 31, 2019. The NRA does not have sufficient facts or information to form a belief as to the then-Treasurer’s “original inten[tion]” or the reasons why he did not sign the Form 990.” Oh, please.

Para. 604. “The NRA admits that the decision to file the chapter 11 [bankruptcy] petition was made and approved by the NRA’s Executive Vice President and CEO Wayne LaPierre and the Special Litigation Committee of the NRA’s Board of Directors.” None of the rest of the board was told.

Para. 605. “The NRA admits that the Special Litigation Committee is a committee of its Board of Directors and that the committee was formed in or around September 2020 to, among other things, oversee certain pending litigation, including this Action. The NRA denies that the purpose for the formation of the Special Litigation Committee is merely “purported.” The NRA admits that the members of the Special Litigation Committee are Carolyn Meadows, Charles Cotton, and Willes Lee.”

Para. 629. “The NRA admits that on or about May 11, 2021, the Bankruptcy Court dismissed the NRA’s chapter 11 petition after finding that it was not filed for a purpose contemplated by the Bankruptcy Code and that—therefore—the proceeding was not filed in “good faith” as that term is used by bankruptcy courts.”

Pitiful, just pitiful. Corruption everywhere, members’ money being pocketed, embezzlers in the highest ranks, the Audit Committee covering everything up rather than investigating, and the spineless board being deceived and unwilling to object. To think that this is a 151-year old organization that we have expected to defend our liberties, an organization that has had several Medal of Honor recipients (most recently Joe Foss) as presidents. . . .

7 thoughts on “NRA Files Answer In NY AG Lawsuit

  1. Walter, here is the latest on this sorry saga. I enjoyed getting together again today and seeing so many old friends with her clubhouse. Glen

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  2. Thank you for this update. I am glad that I saw this late in the evening, when I am not eating. It makes me a touch sick to my stomach. I simply cannot understand how someone can actually be so twofaced as to appear so decent on the outside, and yet be so evil on the inside, and yet here we have examples of a rather large number of them.
    I used to be worried that the innocent might get caught up in the web of this thing. Now I am seeing that it looks like there are no innocents involved, at any level.

    Liked by 3 people

  3. “To think that this is a 151-year old organization that we have expected to defend our liberties”
    In all fairness, its record since at least the Bush administration at bartering them away should have told us all we needed to know.

    Liked by 1 person

  4. The “spineless board” I would hope that I am the exception to that description. I would appreciate at least some honorable mention. In the last 2 elections by the NRA Board for the position held by Wayne LaPierre I nominated Rocky Marshal and Col. West in 2021 and 2022. When NRA filed their hairbrained bankruptcy. I informed that court of the fraud perpetuated upon it. We organized current and former board members to ask the bankruptcy court to appoint an examiner. As I and my family suffer the slings and arrows of my fellow board members and the officers of the Association I have not been silenced nor turned to the dark side. At the last board meeting held in Tyson’s Corner, Va. I attended the Finance Committee meeting. It was clear despite the officers intent to conceal the truth that NRA is in a dire financial situation, I moved that the Committee report be distributed to the entire board. When President Cotton informed the board they were not allowed to view the Ackerman-McQueen settlement, it became apparent that the “Special Litigation Committee” must have requested that provision in the agreement. I moved to disband the SLC for that and other abuses I attribute to them. While I have only 1 board meeting left in my 3 year term I intend to do my best to fulfill my fiduciary duty to the members of the NRA and continue my effort to save our once great association and the shooting sports. Time marches on, the NY and the Washington DC AGs’ cases slow walk to their trial dates and the general membership seems unaware of the looming storm. While the time is now to attempt intervention in the NYAG case I fear the membership will only discover this threat to the 2nd Amendment after it is too late. Between the disinformation spewed out by the PR people in the Association and the broad generalization describing all of the members of the board as you have, is it any wonder why the struggle to “restore NRA” has been so difficult. If you want to know more about the plan to restore NRA to proper governance and how you can help. Visit https://restorenra.com/

    Liked by 1 person

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