NRA Trial Day 10: Testimony from NRA Board Presidents Past & Current
Today in Court
The trial began today with the continuation of playing video deposition testimony from former NRA Board President Carolyn Meadows. The jury then heard live testimony from current NRA President Charles Cotton.
Summary of Today’s Testimony
- Testimony from former NRA President Carolyn Meadows previously taped in late summer 2022 was played for the jury. In addition to being a board member, Meadows has also served on the board’s Audit Committee which, among other things, oversees the group’s whistleblower policies. Nonetheless, Meadows testified that she had not read the NRA’s whistleblower policies and did not believe she had obligations under the NRA’s whistleblower policies.
- With respect to a memo prepared by whistleblowers in the NRA’s Finance department called the “Top Concerns” memo, Meadows testified that she chose to leave an Audit Committee meeting before the whistleblowers presented to the committee because she was worried about missing her flight and didn’t want to stay an extra day. She testified she regrets this decision. Meadows also testified that she was not aware of what the NRA did, if anything, with respect to whistleblower’s complaints.
- In speaking about why she turned against certain board members that asked questions of the NRA’s leadership, Meadows testified that she did not trust people that “go to the New York Attorney General and yell about the organization they’re a part of.”
- Despite testifying that she did not read the NRA’s whistleblower policies, Meadows said that former NRA board member Esther Schneider did not qualify as a whistleblower. Meadows also did not know if the Audit Committee ever discussed Schneider’s concerns about internal controls.
- Former board member Phillip Journey has repeatedly spoken out about the override of internal controls at the NRA, including at this trial. Meadows testified that she did not review board member Journey’s motions or testimony in the bankruptcy and doesn’t know if Journey qualifies as a whistleblower. She said she did not know if the board or Audit Committee considered Journey’s concerns. Nonetheless, she sent an email to the board describing Journey’s filing in the bankruptcy as containing “glaring errors and omissions” and “outright untruths.”
- In a 2021 declaration in the NRA’s bankruptcy, Meadows described how she was the founding member and chair of the NRA’s Special Litigation Committee which was charged with overseeing litigation handled by Brewer Attorneys & Counselors. Despite this, in the testimony from late summer 2022 played in court today, Meadows said she had never reviewed the Brewer retention letter or invoices.
- With respect to the NRA’s decision to pay their then-NRA President Oliver North circuitously through a pass through arrangement with vendor Ackerman McQueen, Meadows testified that she knew about his contract and had heard North say that he needed to take the job to make up for the compensation he would no longer receive from Fox News (from which he would be forced to step down).
- Meadows was asked about signing onto a letter drafted by Oliver North asking questions about the size of the Brewer firm’s legal billings to the NRA. Meadows testified: “I signed it under duress, I was traveling,” and later added that she never read the letter, that it was only paraphrased to her by North, and that she subsequently took her name off the letter. The NYAG then introduced an email from Meadows to North that read: “Ollie, I have read documents and authorize my signature to be added.”
- A May 2019 email from then- NRA Second Vice President, Willes Lee, to Meadows was entered into evidence in which Lee wrote: “‘If you shoot at the king, you better kill him.’ Wayne is still the king. Don’t forget it.”
- Confirming a point that had come out during the bankruptcy trial, Meadows testified that she destroyed notes after being told by the NRA’s General Counsel John Frazer that they could be subpoenaed, saying “I was told that the notes … I would likely have to turn them over to counsel.” Meadows testified that, after learning this from Frazer, she destroyed “a portion” of her notes, admitting that “a few I shredded, and some I burned.” Meadows testified that some of the NRA-related notes were mixed in with personal notes, and that it was impossible to separate the two.
- Meadows was then asked about a 2018 trip to France with her husband and Millie Hallow. She testified that she was in Paris in order to meet with potential donors, but was not aware, and did not ask anyone within the organization, how much money was actually raised by the trip. She was asked by the NYAG if she was aware that $100,000 was spent on black car services during the trip – she responded she did not know the amount.
- An email from NRA board member Joel Friedman to Meadows was introduced reading, “I know you and Millie have been working on keeping 38 votes in Wayne’s corner.” Friedman asked Meadows to provide a list of 25 names, and ended the email ensuring her that “Neither your fingerprints nor mine” will be on the list.
- Charles Cotton is the current NRA President and has spent years serving on the NRA board’s Audit Committee, including as chair. Cotton has given testimony in previous NRA litigations, including the organization’s failed bankruptcy trial and a civil suit with former vendor Ackerman McQueen (a transcript for which, with summary bullets, can be found here).
- Cotton testified that the Audit Committee’s responsibilities included oversight of NRA policies and procedures regarding related party transactions, conflicts of interest, and preventing fraud. The Committee was also tasked with oversight of management’s response to any investigation into alleged violations of NRA policies.
- Cotton testified that the NRA has determined that Wayne LaPierre received a total of around $1 million in excess benefits. Despite that, Cotton said that “at this point” the board has not voted to sanction or terminate LaPierre.
- Video testimony of Cotton was played in court. When asked about who at the NRA was responsible for investigating public allegations of financial malfeasance by LaPierre, Cotton replied it was the responsibility of the NRA’s Financial Services department, defendant and General Counsel John Frazer, and LaPierre himself. Cotton added that he knew “it sounds funny, [LaPierre] investigating, but he was very cooperative in telling us what was going on.”
- The retention and investigation of the tax attorney who looked into the tax implications of LaPierre’s excess benefits, was all handled by the NRA’s Financial Services division. Despite being the head of the Audit Committee, Cotton testified that he did not know the scope of the attorney’s investigation, what documents he was provided, and that the Audit Committee did not oversee his work. Cotton never spoke with the attorney.
- As noted today in testimony, Cotton previously testified that LaPierre encouraged Cotton to run for board first vice president, saying “Charles, you’re perfect for it.”
- When asked if he questioned LaPierre on who paid for LaPierre’s Bahamas flights, Cotton stated he did not because he knew – they were booked through the NRA, so the NRA would have “wound up paying for it.”
- Cotton testified that LaPierre made the decision to put the NRA into bankruptcy, not the Special Litigation Committee, which was formed because of LaPierre and Frazer’s potential conflict with the NRA in the NYAG litigation. The Board of Directors was not informed at their meeting, even though this was only a few weeks before the bankruptcy was filed. Cotton presided over that meeting as President, and was aware that bankruptcy was being considered.
- Cotton testified that defendant Woody Phillips was “not on top of things” and that he believed there were some “deficiencies” in his performance. Phillips retired in 2018.
- Counsel for the NYAG also introduced testimony from Cotton taken during its investigation (dated June 2, 2020). During this testimony, Cotton stated that he was “not happy” that Frazer had brought several related party transactions to the Audit Committee for retroactive approval. When asked if Frazer was a good General Counsel in June 20, 2022, Cotton responded, in part, that “he works hard” and has “learned a lot.”
Analysis
Between today and tomorrow, the jury will hear from three consecutive NRA board presidents: Oliver North, Carolyn Meadows, and Charles Cotton. The NYAG appears to be eliciting testimony of Meadows and Cotton that show near absolute loyalty to LaPierre, and the desire to crush any dissent within the board. In contrast, one might expect North, who was a bit of an outsider to LaPierre’s inner-circle, to testify that when he started asking questions about the finances and rocking the boat, that he quickly found himself thrown overboard.
Meadows and Cotton’s testimony indicate that despite being not only board members, but members of the Audit Committee tasked with overseeing internal controls at the NRA, they lacked basic knowledge of the internal controls and took little to no action personally to address concerns brought forth by whistleblowers. Meanwhile, Cotton said that those responsible for investigating allegations against LaPierre were LaPierre himself and the Financial Services department and John Frazer, all of whom report to LaPierre. This underscores the systemic lack of oversight of NRA management by its board. Meanwhile, Meadow remains a board member and the board recently amended the organization’s bylaws which enabled Cotton to continue to serve a nearly unprecedented third term as president.
A smaller but important point: the uncontested testimony to date indicates that the Oliver North contract with Ackerman was the idea of the NRA, negotiated by the NRA, and that the costs of the contract were simply passed through to the NRA. The testimony indicates this was because North would not be able to continue his paid appearances on FOX News as NRA President. So why not just have the NRA contract directly with Oliver North? The NRA Bylaws contemplate the NRA board president position to be non-compensated. Yet, instead of following the clear instructions of its Bylaws, the NRA chose this creative work-around.
Charles Cotton was fairly combative as witnesses go, often challenging the NYAG attorney on basic questions. As a result, the NYAG impeached Cotton with video clips of his previous testimony on several occasions.
What’s Next?
The trial will resume on Tuesday morning at 9:30am with the live testimony from former NRA President Oliver North, after which the testimony of Charles Cotton will continue. If time allows, the jury will then hear previously taped video testimony from former NRA CFO Craig Spray.