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Veterans injunction delayed

Ryan Carter

A judge Friday decided to delay a decision on whether to close the

Burbank chapter of the Disabled American Veterans club because of

alleged financial mismanagement of its bar operations.

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The injunction being sought by the national organization of the

Disabled American Veterans will close the club after 70 years in

town. And it will force its local trustees to turn over the club’s

assets to the national organization, which is claiming in a lawsuit

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that the local trustees mismanaged bar and lounge funds.

Glendale Superior Court Judge Laura A. Matz decided to take more

time considering whether an injunction was warranted in the case,

which she called “awful.” She was perturbed that the litigation would

hurt disabled veterans the most, she said.

“I think something terrible is going on here,” she told attorneys

from the national organization and the local chapter, adding, “the

issues raised here are extraordinary.”

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As part of the lawsuit, attorneys for the national Disabled

American Veterans organization want the injunction in order to seize

Burbank Chapter 40’s assets while the lawsuit proceeds and to

investigate where revenue was going. They also want to revoke the

charter of the property at 1115 W. Magnolia Blvd.

The local chapter’s trustees can argue their case in front of the

national executive board in February in Virginia. But Matz said she

might not have any authority to allow the national organization to

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take the assets.

After the national organization attempted to revoke Chapter 40’s

charter, the chapter’s trustees transferred ownership of the property

to members-at-large, essentially creating a whole new nonprofit with

veterans as members, an act that the national organization’s

attorneys said was a violation of bylaws.

Under the new nonprofit, the club’s bar, a major source of income

for the club, was still operating under a liquor license granted to

the DAV, not the new club.

In the lawsuit, national DAV attorneys said the transfer was a

“scheme to deprive members of benefits” after the national

organization began investigating the bar and lounge’s “deteriorating

financial condition” and lack of funding toward disabled veterans

programs. “You can’t have officers of a chapter, who have decided to

not follow the rules of the chapter, continue running the chapter,”

the national organization’s attorney, Mark S. Shipow said, adding

that officials want to find out happened to allegedly siphoned bar

revenues.

William Ramseyer, the local chapter’s attorney, argued that the

club’s bylaws follow the national bylaws with the exception of when

it comes to dissolving the chapter.


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