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Case Citations [1] (July 2020 - April 2021)

handle is hein.ali/alicodpri9907 and id is 1 raw text is: CHARITABLE NONPROFIT ORGANIZATIONS CHAPTER 6. STANDING OF PRIVATE PARTIES § 6.03. Standing of a Private Party to Enforce the Purposes to Which Charitable Assets are Devoted and Administrative Terms Governing Charitable Assets D.D.C.2020. Quot. in sup. (quoting § 6.03 of T.D. No. 2, 2017, which is now § 6.03 of the Official Text). Purchasers of insurance policies under a group health-insurance program brought a putative class action against nonprofit program administrator, administrator's subsidiary, and grantor trust organized by administrator, alleging that defendants breached fiduciary duties owed to plaintiffs by failing to inform them of royalty payments that defendants withheld from insurer out of the premiums plaintiffs paid, because the royalty payments were illegal commissions evidencing that defendants engaged in self-dealing. This court granted defendants' motion to dismiss, holding, inter alia, that defendants did not owe plaintiffs any fiduciary duties on the theory that administrator held itself out to plaintiffs as an unbiased advocate for its members. The court cited Restatement of the Law, Charitable Nonprofit Organizations § 6.03 in reasoning that, under the common law, private parties typically could not bring claims against nonprofit organizations to enforce the charitable purposes or administrative terms governing charitable assets, and that large membership organizations like administrator and its members typically had an ordinary business relationship, not one creating fiduciary duties. Krukas v. AARP, Inc., 458 F.Supp.3d 1, 10. COPYRIGHT ©2021 By THE AMERICAN LAW INSTITUTE All rights reserved Printed in the United States of America For earlier citations, see the Appendices, Supplements, or Pocket Parts, if any, that correspond to the subject matter under examination. ALI

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