NRA Bankruptcy Control is Getting Dicey for Entrenched Leadership

Opinion

NRA Board Membership Tug of War
NRA Bankruptcy Control is Getting Dicey for Entrenched Leadership

USA – -(AmmoLand.com)- Most readers probably know that the NRA filed Chapter 11 bankruptcy last month with the stated purpose of reorganizing the Association as a Texas corporation.

NRA officials have made multiple public statements to the effect that the organization is in solid financial shape, and the bankruptcy is just being used as a legal tool for moving the Association’s charter out of the unfriendly environs of New York, where it has been located since the group’s inception 150 years ago, and into the much more welcoming environment of Texas, home of some 400,000 NRA members.

Since the bankruptcy filing, there has been a lot of speculation and second-guessing, and there have been a lot of rumors flying and briefs filed.  I don’t think anyone could accurately report on everything that’s been going on, and certainly not on what might happen next, but here is what I think I know so far, along with some speculation on what could happen.

I feel obligated to remind readers that I am not an attorney, and I have very limited knowledge about bankruptcy proceedings, so there’s a good chance that I could get some of the technical details wrong.  Anyone with verifiable expertise in bankruptcy law is invited to reach out to me to correct any errors I make, and I will pass that information on to our readers.

On January 15, 2021, Wayne LaPierre filed chapter 11 bankruptcy on behalf of the NRA.

This was done unilaterally by LaPierre, with the blessings of the NRA President and its two vice presidents, but without any vote, or even discussion, by the NRA Board of Directors.

Though there was immediate speculation about the filing being in “bad faith” and being a ploy to dodge various lawsuits, in particular a potentially crippling lawsuit brought by the state of New York, the judge in the case has allowed the bankruptcy procedure to advance, and NRA has publicly stated that they are not seeking to avoid the New York suit.

One of the early steps in the bankruptcy process was for the judge to name a Creditor Committee to represent the creditors in the action.  The court chose 5 creditors to be on the committee: The Pension Benefits Guarantee Corporation (a government agency which, among other things, insures pension benefits), Ackerman McQueen (NRA’s long-time PR company, with whom they had a dramatic falling out in 2019, with lawsuits pending), InfoCision Incorporated (NRA’s long-time telemarketing and fundraising partner, whom they paid some $21 million dollars in 2019, and which is still working for the Association), Stone River Gear, LLC (a wholesaler of knives, flashlights, and other outdoor gear.  I’m not clear on their current status as an NRA vendor), and David Dell’Aquila (the major donor who has led a donor revolt and filed a class-action lawsuit accusing NRA and its leaders of fraud).

Dell’Aquila feels strongly that the problems at the NRA all lay at the feet of Wayne LaPierre and his supporters on the Board.  He has already declared his intention to ask the judge to appoint a trustee to take over management of the Association and supervise its reorganization.  He seems pretty confident that he can get Ackerman McQueen to join him in that request, but I suspect there could be resistance from InfoCision and Stone River Gear, as those two appear to still be doing business with the NRA, and could possibly be supportive of the current regime.  InfoCision, in particular, considering how much money they’ve made year after year from the NRA, probably isn’t anxious to see any major regime change.  If I were the judge, I’d be looking closely at them, to be sure that they’re not in the creditor pool by design, to support the status quo.

NRA’s lead attorney, Bill Brewer, has disparaged the inclusion of Dell’Aquila on the Creditor Committee, referring to him as a “disgruntled individual who has filed frivolous claims against the Association.”  Brewer has also filed to have his firm be supplemental, Special Counsel, in the bankruptcy case.  NRA hired a bankruptcy specialty firm to represent them, but now Brewer claims that he and his firm, which is NRA’s largest contractor, pulling down something in excess of $2 million per month, have historical knowledge that isn’t easily transferable and will be useful.  Skeptics might suggest that it’s just one more way for Brewer, whose basic rate is $1400 an hour, to generate more billable hours to charge to NRA.

NRA Examiner Appointment Request Motion

The latest twist has been the filing of a motion by NRA Board member Phil Journey, (embedded below and well worth a read) calling for the appointment of an Examiner (investigator), to explore the various accusations of corruption, mismanagement, cronyism, and financial misdeeds on the part of executives, as well as questionable vendor contracts, and failure of the Board to fulfill its fiduciary responsibilities. Regular readers will be familiar with Phil Journey, as he has been a contributor to AmmoLand News.

Based on Journey’s filing, it looks like the judge must appoint an Examiner unless there is a Trustee appointed.  Appointing an Examiner is considered a somewhat less drastic step, and could be a preferred choice for the judge, who might be reticent to take the major step of appointing a Trustee.  As I understand it, the judge can appoint a Trustee at some later date, if the evidence the Examiner turns up were to warrant such a step.

NRA Examiner Appointment Request Dkt. No. 114

The NRA leadership has already come out with criticism of Journey’s motion.  In an email to Board members, under the signature of President Carolyn Meadows, the leadership declared the filing to be unfortunate and claimed that Journey is mistaken in his interpretation of certain of the Association’s Bylaws. Journey had pointed out in his motion that the Bylaws strongly suggest that any really big decisions affecting the Association, should not be undertaken by the staff, or even the Executive Committee of the Board, but should be brought to the entire Board for a vote if at all possible.  It’s apparent that plans for the bankruptcy declaration go back at least to mid-November when the shell company in Texas was created to give the Association a toehold there.  That means that LaPierre and the officers had two opportunities to bring the matter to the Board, but chose to keep it under wraps.

The email went on to accuse Journey of flat-out lying in the motion when he included among the accusations deserving of investigation, a claim that a female director was told to “sit back and shut-up” when she tried to ask questions about NRA finances.

Journey Examiner Motion Request Sit Back And Shut-Up Paragraph
Journey Examiner Motion Request ~ Sit Back And Shut-Up

Seems funny that this particular accusation was declared to be a lie, while the accusations of extortion, self-dealing, theft, abuse of power, and failure of the Board to properly exercise their fiduciary responsibilities, were all left unchallenged.

The email makes it clear that Journey has ruffled the feathers of the powers that be within the NRA hierarchy, and that his motion throws a monkey wrench into their plans.  I think they believed they could beat Dell’Aquila’s push for a Trustee, but I don’t think they’ll be able to block Journey’s, a current NRA Board member with valid standing claims, motion for an independent court-appointed Examiner.

It is worth noting that Journey and I have been friends for many years, and he and my father, Neal Knox, were friends as well.  Phil was first elected to the NRA Board back in 1995, with Dad’s support, but lost his bid for reelection in 1998, after LaPierre had gained the upper hand and began purging “Knox supporters” from the Board.  Not only is Phil a true gun guy – collector, competitor, youth coach, hunter, and all-around firearm enthusiast – he is also a very competent attorney, former State Senator with a stellar track record of pro-rights achievements in the Kansas State Senate, an accomplished talk show host, and he currently serves as a District Judge in Kansas.  This guy ain’t no slouch.

Journey’s motion for an Examiner, as well as Dell’Aquila’s call for a Trustee, can be reasonably compared to the voter fraud questions that have been raised around the country: If everything was all done on the up-and-up, then all sides should support a thorough investigation and audit by an independent, neutral third party, which would definitively either prove corruption or prove there’s not any.  Just saying “Trust us… Everything’s fine,” while blocking efforts to investigate the accusations, isn’t instilling any confidence – in voters or NRA members – and confidence is what’s really needed.

Judge Phil Journey isn’t looking for any position for himself in this matter.  He’s working solely for the benefit of the members and the NRA.  He’s not independently wealthy and doesn’t have big money donors backing his play – yet.  He has received some financial assistance from a few NRA supporters, but he’s paying the full retail price for the top-notch bankruptcy law firm he’s retained to represent him in Texas, so he’s going to need much more help from many more people.  A formal, legal assistance fund is expected to be set up soon, and I’ll keep you posted about that.

The other thing that would really help to move this case forward, would be for people with knowledge of corruption and misdeeds within the NRA, to step forward and be whistle-blowers, providing details to Phil for presentation to the judge or the Examiner.

I think this is the best opportunity we’ve had in decades to finish the work that was started in Cincinnati in 1977, and finally, put the members back in charge of the NRA.  Let’s get it done.


About Jeff Knox:

Jeff Knox is a second-generation political activist and director of The Firearms Coalition. His father Neal Knox led many of the early gun rights battles for your right to keep and bear arms. Read Neal Knox – The Gun Rights War.

The Firearms Coalition is a loose-knit coalition of individual Second Amendment activists, clubs, and civil rights organizations. Founded by Neal Knox in 1984, the organization provides support to grassroots activists in the form of education, analysis of current issues, and a historical perspective of the gun rights movement. The Firearms Coalition has offices in Buckeye, Arizona, and Manassas, VA. Visit: www.FirearmsCoalition.org.

Jeff Knox

 

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Phillip Journey
7 months ago

Now You can help online at:

https://restorenra.com/

Phillip Journey
8 months ago

Tax deductible donations may be made out to CDFE

Mail to 
CDFE c/o Phil Journey
PO Box 501
Haysville, Ks. 67060

All funds donated will go toward legal expenses. 

Larry
Larry
8 months ago

I think this is the best opportunity we’ve had in decades to finish the work that was started in Cincinnati in 1977, and finally, put the members back in charge of the NRA.

Assuming some people put in a truckload of effort to achieve this, what’s to keep Letitia from nuking the organization regardless?

Last edited 8 months ago by Larry
Charlie Foxtrot
Charlie Foxtrot
8 months ago
Reply to  Larry

What’s to keep Letitia from nuking the organization regardless? Its members!

Even if the NRA goes up in flames, its members are still there. At this point, the organization’s leadership has done the NY AG’s job in destroying the organization quite well, because the members let the leadership take full control of the organization and kept supporting it for years.

The NY AG’s lawsuit is completely based on the current leadership’s past actions. Remove that leadership and repair the organization, and the NY AG’s lawsuit is baseless!

Phillip Journey
8 months ago
Reply to  Larry

If successful in dallas we will make the NYAG case moot

Phillip Journey
7 months ago
Reply to  Larry

Larry thank you, If we are successful we will make the NYAG suit moot.

Big George
Big George
8 months ago

I’d love to see Chris Cox be assigned as the independent court-appointed Examiner! What’s that sound?!…is that Wayne’s sphincter muscle sucking a little air at the thought!?

Dave in Fairfax
Dave in Fairfax
8 months ago
Reply to  Big George

BG,

You need to listen better, it was slamming shut.

Charlie Foxtrot
Charlie Foxtrot
8 months ago
Reply to  Big George

You think Chris Cox, who has been on the NRA’s payroll for years before he departed, can be independent? LOL! It amazes me how many people still don’t understand what a train wreck the NRA organization really is. Also, Chris Cox did the NRA’s video on supporting red flag laws and participated in the NRA’s statement on regulating bump stocks, so many will have problems with Chris Cox being involved.

Big George
Big George
8 months ago

Save your ‘LOL’ there Tango Baker! From what I read it was at the direction of LaPierre that Cox became the NRA’s ‘face’ for regulating bump stocks and support of red flag laws. Then good ole Wayne gave Cox the boot as was LaPierre’s usual tactic, allowing himself to remain being portrayed as NRA’s ‘good guy’.

Charlie Foxtrot
Charlie Foxtrot
8 months ago
Reply to  Big George

You do understand that you are making my point, right? How can Chris Cox be considered independent when he went along with Wayne LaPierre on red flag laws and bump stocks in the past and then was let go under rather odd circumstances? Was he fired or did he resign? He continued to receive his salary for several months after he heft his NRA-ILA office, by the way. Understand that Chris Cox has now his own lobbying organization, Capitol 6 Advisors, and would be conflicted anyway! He also would be conflicted as a former member of the organization that owns… Read more »

Last edited 8 months ago by Charlie Foxtrot
Big George
Big George
8 months ago

Yes Zebra Xray, I DO understand that we are saying the same, so you may have the last word! Personally, I’m done with the NRA unless there’s a massive reorganization!! It sickens me to know my Life Membership fees paid for LaPierre’s $4k Emporio Armani suits!!

Patriot
Patriot
8 months ago

Replacing current leadership (and it must be replaced) with Jeff Knox is not the answer. Way too much bad blood there because of his father. Where is the leader that will take the job with no pay because they really believe first and foremost in protecting the 2nd amendment? We just had a President that did that. Everyone else that is trying to get control of the NRA is simply doing so to make money from the generous donations of the loyal members.

Chev
Chev
8 months ago

Opinions are like certain body parts, everyone has one. Knox has been whining on this forum for too long. Boo-hoo! Daddy got booted, now I’m going to create a new forum to compete with the NRA and slam them every time I can put together enough words to do so. Knox is scamming for business for his own operation. Good for him, but leave the sour grapes at home and don’t fowl us with your whining.

Dave in Fairfax
Dave in Fairfax
8 months ago
Reply to  Chev

Chev,

Which opinion of Jeff’s is it that you have a problem with?
He’s made valid criticisms of the NRA and now many of them are coming home to roost. I haven’t heard him FOUL us with any whining. Please be explicit.

Ltbdb
Ltbdb
8 months ago

Now is the time to boot LaPierre and his cronies out of the NRA. He has been living high on the hog on NRA money for a long time. NRA members that want to join the effort to get him out and return control of the NRA to the board of directors and the members need to go to http://www.helpsavethenra.com and join the effort to oust him. I for one have stopped supporting the NRA with my contributions and put my financial support behind SAF and GOA. They are both doing more to save our second amendment rights than the… Read more »

TStheDeplorable
TStheDeplorable
8 months ago

Just as I never trust a pastor who is filthy rich, I never trust the head of a “not for profit” who became rich running the not for profit organization.

Mike the Limey
Mike the Limey
8 months ago

I let 20 years of membership lapse because the suck from him is so blatant.

Phillip Journey
8 months ago
Reply to  Mike the Limey

I hope within 6 month we earn your trust

AZ Lefty
AZ Lefty
8 months ago

The only way this compares ot the elections is that La Pierre like Trump lies out his ass!
You sound as bad as La Pierre sucking Trumps ass.

YourWorstEnemy
YourWorstEnemy
8 months ago
Reply to  AZ Lefty

Leftists are just the nastiest people with their homophobic slurs why they tell you that you are not tolerant enough? I guess AZL your shame and guilt in having to steal an election to keep power is eating up your small brain.

Charlie Foxtrot
Charlie Foxtrot
8 months ago
Reply to  YourWorstEnemy

You still believe in this QAnon story that Italy stole the election? How many accounts do you have on Ammoland anyway?

Big George
Big George
8 months ago
Reply to  YourWorstEnemy

‘Leftists & brain’…the perfect oxymoron.

JSNMGC
JSNMGC
8 months ago
Reply to  Jeff Knox

Jeff, It’s more than what you described. Many NRA members (and many, many more would-be members) are not just mistrustful of the current leadership, they are disagree with: The governance structure, which is upside down. Management should be accountable to the Board and the Board should be accountable to the members; The strategy of continual compromise; The lack of criticism of politicians who flip-flop; The disdain for members (no involvement/coordination with grassroots organizations); The lack of transparency (even before Wayne’s reign); The focus on lawyers, marketing, and high-level rhetoric and little focus on research, data, and formation of detailed, logical… Read more »

JSNMGC
JSNMGC
8 months ago
Reply to  JSNMGC

That’s what I mean by being upside down. It should be more like a publicly-traded company. Management presents their plans to the BOD for approval and then executes to those plans. The BOD reviews the performance of management at least quarterly. The BOD sets bounds on management’s authority. If the stockholders (the owners of the company) don’t like the way things are going, they vote in new board members. If the BOD doesn’t like the CEO’s performance, they fire the CEO.

musicman44mag
musicman44mag
8 months ago

I love the war. Politicians and politics. Using tools against tools. The second one is not a tool in the tool box. LOL. Suck it New Dork.