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AILSA CHANG, HOST: A federal bankruptcy judge dismissed an effort by the National Rifle Association to declare bankruptcy, ruling that the gun rights group had not filed the case in good faith. It s a setback for the organization, which faces an attempt by the New York state attorney general to dissolve it. The month-long bankruptcy trial put into the public record details of questionable spending by senior NRA officials, and it painted a picture of an organization in crisis. NPR s Washington investigative correspondent Tim Mak has more.
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Wayne LaPierre, chief executive officer of the National Rifle Association, stands on stage after arriving at the NRA annual meeting in Dallas on May 5, 2018.
Updated at 6:43 pm ET
A federal bankruptcy judge dismissed an effort by the National Rifle Association to declare bankruptcy on Tuesday, ruling that the gun rights group had not filed the case in good faith.
The ruling slams the door on the NRA s attempt to use bankruptcy laws to evade New York officials seeking to dissolve the organization. In his decision, the federal judge said that using this bankruptcy case to address a regulatory enforcement problem was not a permitted use of bankruptcy.
Adam KlasfeldMay 11th, 2021, 3:54 pm
A federal bankruptcy judge rejected the National Rifle Association’s Chapter 11 petition on Tuesday, finding that the cash-flush gun group brought their case in bad faith to avoid a lawsuit by the New York attorney general which seeks to dissolve the organization.
“There are several aspects of this case that still trouble the Court, including the manner and secrecy in which authority to file the case was obtained in the first place, the related lack of express disclosure of the intended Chapter 11 case to the board of directors and most of the elected officers, the ability of the debtor to pay its debts, and the primary legal problem of the debtor being a state regulatory action,” U.S. Bankruptcy Judge
The recommendation bolstered the arguments of New York Attorney General Letitia James, who has fought the NRA’s attempts to relocate from New York to Texas.
May 4, 2021 12:03 p.m.
A Justice Department official all but quashed the National Rifle Association’s hopes at declaring bankruptcy and moving to Texas on Monday.
The U.S. Trustee, a DOJ office that enforces bankruptcy laws and which rarely takes sides in bankruptcy disputes, told a Texas federal judge that it opposed the NRA’s bankruptcy petition and that “the evidentiary record clearly and convincingly establishes” that NRA Executive Vice President Wayne LaPierre “failed to provide the proper oversight.”
“The record is unrefuted that Wayne LaPierre’s personal expenses were made to look like business expenses,” Assistant U.S. Trustee Lisa L. Lambert told federal bankruptcy judge Harlin Hale, the New York Times reported.