American Lung Association cuts tie with NW chapter

Saturday, November 01, 2008

By GENE JOHNSON, Associated Press Writer

SEATTLE — 

The national charity sent a cease-and-desist letter to regional affiliate American Lung Association of the Northwest, the ALA told The Associated Press on Friday. The letter demanded that the regional affiliate stop using the American Lung Association name, turn over its financial assets and take steps to get the building back.

"We took these steps in order to protect these assets, which were intended for the purpose of advancing the mission of the American Lung Association," Carrie Martin, a spokeswoman for the national association, said in an e-mail. The affiliate represents the organization in Alaska, Washington and Idaho.

The national group, founded in 1904, notified the affiliate in September that it had 30 days to fix alleged violations of the organization's policies.

At the heart of the dispute is the sale of the Northwest affiliate's $3.2 million Seattle headquarters to a separate corporation set up by the affiliate's chief executive without permission from the national organization.

The building was originally purchased by the organization's Washington branch, which later merged with the state groups in Alaska and Idaho. The Northwest affiliate is now listed as the building's owner.

But real estate records show that the affiliate sold the building to the Pacific Northwest Lung Cancer Foundation for $10 in August. The affiliate, whose office is in the building, then paid $600,000 for five years' of rent to the new lung foundation, Mike Alderson, president and chief executive of the affiliate, said in a deposition.

In early October, the national group obtained a temporary restraining order barring Alderson from violating the operating agreement that governs the relationship between the two organizations. The agreement says affiliates must "hold all their funds and other assets in their own names."

The American Lung Association also said Alderson tried to change the affiliate's mission statement from that of the parent organization. The change never took place because it was not approved by the affiliate's board and the national organization.

The ALA also claims Alderson forbid his staff from speaking to the national group, hindering day-to-day operations of both organizations.

Alderson said in a court declaration that he requested calls from the national organization be routed to keep the national charity from "meddling."

The sides failed to reach agreement during mediation this past week in Washington, D.C.

Alderson said he and two other "concerned community members" established the new lung foundation in case the national organization tried to dissolve the operating agreement. Court documents indicate some board members were concerned that the group's financial problems would lead to the national organization seizing control.

Laird Harris, chairman-elect of the Northwest affiliate's board, did not immediately respond to a call seeking comment Friday, but told the AP before entering mediation that he cited "sound business reasons" for transferring the building.

"The ALA and the ALA-NW have had a long, stable relationship covering a period of decades," Steve Nolan, chair of the American Lung Association said in a court declaration. "That changed abruptly ... when Mike Alderson took over" in June.

Alderson did not return a call for comment Friday night.

Donors to the American Lung Association said they were troubled by the Northwest affiliate's new direction.

Eric Myers, a donor and volunteer in Alaska, said he donated $3,000 to help defend a smoke-free-workplace law in Juneau. The donation was not approved, so Myers gave the money to the American Cancer Society instead.

"The ALA's goodwill, established over the last 100 years, is one of the ALA's most important assets," Nolan said.

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