NRA on Trial: Day 8 Summary of Bankruptcy Trial
The NRA began its case in court today, on the eighth day of its bankruptcy trial in Dallas. Prior testimony elicited by the New York Attorney General and former NRA vendor Ackerman McQueen in the first half of the trial established several shocking details illustrating the severity of the NRA’s mismanagement — from millions in private jet travel by executives, to testimony suggesting CEO Wayne LaPierre hid the NRA’s bankruptcy filing from board members, to NRA President Carolyn Meadows admitting to burning and shredding documents ahead of a subpoena.
The NRA’s first two witnesses were board members and LaPierre loyalists Willes Lee and Tom King. While the NRA offered these witnesses to support their legal positions, the testimony exposed several contradictions in the NRA’s case, as detailed below.
- NRA Offers CEO Wayne LaPierre as Strong and Virtuous Leader, Despite Earlier Testimony About LaPierre Being a “Trainwreck.” Board member Willes Lee testified today and called Wayne LaPierre of “the highest character.” Likewise, board member Tom King called LaPierre the “leader the NRA has needed.” The core of the NRA’s position at trial is that LaPierre is indispensable to the NRA’s success and any of the allegations of improper behavior are political attacks or untruths.
- IN FACT: This position was contradicted yesterday by longtime NRA Board Member Owen “Buz” Mills, who called CEO Wayne LaPierre a “trainwreck” and former NRA board member Esther Schneider who testified to LaPierre’s power over the board, saying “[t]here are no decisions made pertaining to the board or the operation of the NRA that do not have Wayne’s blessing.” Last week, longtime LaPierre business associate Anthony Makris testified that LaPierrre had described his personal management style as “management by chaos”, wherein he intentionally kept senior leaders in conflict with each other so he could retain control.
- In his own testimony, LaPierre admitted that, starting in 2013, he began making annual week-long trips to the Bahamas, where he stayed on one of two yachts owned by David McKenzie. McKenzie, a Hollywood producer, is a part or full stakeholder of multiple NRA vendors. LaPierre insisted that these trips were “a security retreat.” In addition, LaPierre said he also made multiple annual trips around New Years Eve to the Bahamas, where he would stay at the Atlantis Resort on Paradise Island, also paid for by McKenzie. LaPierre’s travel agent, in a deposition played in open court, said LaPierre directed her to omit embarrassing personal travel details from official invoices.
- NRA Claims Bankruptcy Necessary Due to Not Getting a Fair Shake in New York, Despite LaPierre Admission That New York Courts Are Not Biased Against NRA. Wayne LaPierre testified at trial that the NRA filed for Chapter 11 because of the New York Attorney General’s lawsuit against it and that the NRA believes New York “is not a fair playing field.” This argument was echoed in the NRA’s Chapter 11 announcement in which the NRA said it was “DUMPING New York” to move to Texas and be “free from the toxic political environment of New York.” Similarly, today, board member King testified the Attorney General’s lawsuit was “purely for political purposes.”
- IN FACT: Under cross examination, multiple NRA witnesses have acknowledged the New York Attorney General cannot dissolve the NRA unilaterally, and any determination about the lawsuit will require determination by New York state courts. Likewise, both LaPierre and Lee admitted that they do not believe the New York courts are biased against the NRA. Moreover, the Judge hearing the New York Attorney General case in New York, Hon. Joel Cohen, previously ruled for the NRA in its 2019 litigation against former board President Oliver North. These facts and admissions severely undermine the NRA’s justification for Chapter 11 filing; a key issue in the dismissal motion in front of the court.
- NRA Says it Cleaned Up its Act, Despite Little Evidence of Change: The NRA has argued that court supervision of the entity, or an examiner to investigate fraud at the NRA, is unnecessary because the organization has undertaken a purported “self-correction.” Board members Lee and King testified to this today.
- IN FACT: Evidence from several witnesses during the trial has established that the NRA’s bankruptcy was filed in January 2021 without informing salaried officers, including the General Counsel and CFO (and only three members of the more than 70-person board were informed). This stealth Chapter 11 process directed by LaPierre mere months ago raises questions about LaPierre’s power and board oversight. Additionally, testimony throughout the trial has established the NRA has paid the Brewer law firm between $50 and $60 million (the Brewer firm continues to serve as counsel for the NRA on a number of matters). When asked about the NRA’s purported “self-correction” that has been at the heart of the NRA’s defense during the trial, NRA board member Owen “Buz” Mills testified “I believe that the management is corrupted and I believe the board is corrupted. I don’t see anything there that is salvageable.”
- More dramatically, testimony played in open court yesterday included NRA President Carolyn Meadows acknowledging that she “shredded and actually burned” her notes from phone calls and meetings because, according to her, NRA General Counsel John Frazer told her “they could be subpoenaed or used.” In his recent trial testimony, Frazer confirmed he was aware of Meadows’s prior testimony about document destruction, adding “she later testified that it was someone else that she had discussed it with.” The destruction of evidence is not normally an activity associated with an organization that has turned the corner with respect to compliance.