N.R.A. Chief Takes the Stand, With Cracks in His Armor
Wayne LaPierre has led the National Rifle Association for 30 years, but his implacable image looked threadbare in bankruptcy court.,
For three decades, Wayne LaPierre has been the implacable face of the gun lobby, a scourge of the left who argued that giving ground on gun control was akin to giving up on America. So it was remarkable to see the shambolic turn his tenure atop the National Rifle Association has taken showcased last week in federal bankruptcy court in Dallas.
Mr. LaPierre acknowledged that he had secretly taken the N.R.A. into bankruptcy — without telling even his top lieutenants or most of his board — essentially as an end run around attacks from the New York attorney general, who is seeking to shut down the group amid charges of financial mismanagement and corruption. And he made a string of admissions that served largely to underscore the N.R.A.’s disarray and the questions about his own fitness to lead it.
He didn’t know, he testified, that his former chief financial officer had received a $360,000-a-year consulting contract after leaving under a cloud.
He didn’t know that the personal travel agent the N.R.A. had hired to book charter flights for him and his family — the Bahamas was a favorite destination — was charging a 10 percent booking fee on top of a retainer that could reach $26,000 a month.
He didn’t know that one of his former top lieutenants had arranged for his wife to be hired by an N.R.A. contractor, or that her compensation had been billed back to the N.R.A.
And he didn’t fire his personal assistant after it was discovered that she had diverted $40,000 to pay for her son’s wedding and other personal expenses.
Yet if the central takeaway in Dallas was of a once-mighty organization and its chief executive on their heels, the enduring power of the movement Mr. LaPierre and the N.R.A. have built was on full display 1,300 miles away, in Washington.
On Thursday, while Mr. LaPierre was appearing in bankruptcy court via video link, President Biden was in the White House Rose Garden lamenting the “international embarrassment” of American gun violence, most recently visible in mass shootings in Georgia, Colorado and South Carolina. Then he offered a relatively thin gruel of gun-control measures achievable through executive action, given that more far-reaching measures — like universal background checks or an assault weapons ban — were unlikely in an era with a narrowly divided Senate and filibuster rules still in effect.
“We’ve got a long way to go — it seems like we always have a long way to go,” the president said.
Weakened by internal strife, and after an attenuated presence in the 2020 presidential election, the N.R.A. these days often seems more fixated on litigation than guns. Among other things, it has spent nearly $8 million in legal fees to do battle with its former top lobbyist, Chris Cox, the attorney general’s office claimed, even though Mr. Cox is seeking a little over a quarter of that amount in a severance dispute. (A lawyer for the N.R.A.’s main outside firm called the figures “misleading” but did not provide a breakdown.)
But perhaps the N.R.A.’s greatest power remains the perception of its power. Mr. LaPierre, 71, has succeeded in embedding an aggressively uncompromising message on guns into Republican orthodoxy, and the group, though diminished, remains a lobbying force. The gun debate now plays out most fiercely at the state level, where an invigorated gun-control movement is passing new restrictions in blue states, like a recent tightening of background checks in Maryland, while more red states are making it easier to carry guns without a permit, as Tennessee moved to do last week.
“With Wayne’s leadership, the N.R.A. has always been a grass-roots organization,” said Todd Rathner, a lobbyist and N.R.A. board member, adding that the group has been adept at educating gun owners “on how to pick those candidates who best support their rights.” Its political muscle is felt most keenly in Republican congressional primaries, where candidates jockey to outdo each other’s Second Amendment bona fides.
“Those primaries sort out who has the purest Second Amendment DNA and who doesn’t,” Mr. Rathner said.
But Mr. LaPierre himself has been in retreat, less visible than he once was, and, he testified, “living under incredible threat.” He has found refuge on two luxurious yachts, Illusions and Grand Illusion, owned by an N.R.A. contractor — “the two illusions, grand and regular” as James Sheehan, a senior lawyer in the attorney general’s office, put it, though the more humbly named Illusions has four staterooms and two Jet Skis. The yachts were often in the Bahamas, where Mr. LaPierre also stayed at the Atlantis Resort in Paradise Island, or in Europe, where he said he needed to recruit celebrities.
Carolyn Meadows, the N.R.A.’s president, described Mr. LaPierre as a reformer in a statement for this article, saying he “has unapologetically pursued a course correction.”
On the stand, Mr. LaPierre comes across as an antiquated, absent-minded professor. He describes himself as unapologetically “old school.” He does not use a computer, preferring yellow legal pads. He does not text. He started reading emails on his phone only in the last couple of months. His answers in court wandered so frequently that he was often interrupted and implored to keep his focus by opposing counsel, as well as the presiding judge, Harlin D. Hale and even his own lawyer. (“Mr. LaPierre, it’s rare that I’m going to interrupt you, but stick to yeses and nos if possible,” one of his lawyers, Gregory Garman, interjected during his testimony.)
Mr. LaPierre is seeking to use bankruptcy to help reincorporate the N.R.A. in the more gun-friendly state of Texas, and has already repaid the N.R.A. about $300,000 as he seeks to hold on to his job. Asked if he was disciplined for misspending the money, he said, “Yes, I was disciplined, I paid it back,” suggesting that at the N.R.A., discipline sometimes amounts to paying back money after you are caught.
Whether his bankruptcy gambit will work remains to be seen. To persuade Judge Hale that the N.R.A.’s petition should be rejected during a trial that started last week, lawyers for the attorney general, Letitia James, and for a major creditor — the N.R.A.’s former advertising firm, Ackerman McQueen — presented evidence that they said showed that Mr. LaPierre had sought bankruptcy protection in bad faith.
Proving that a filing was made in bad faith can be difficult because it means showing intent. But Monica Connell, an assistant attorney general, argued that Mr. LaPierre lacked the authority to take the N.R.A. into bankruptcy on his own and had used a “convoluted” ploy to get its board of directors to unwittingly grant the necessary authorization.
Rather than putting a bankruptcy resolution before the board, Ms. Connell said, Mr. LaPierre’s team asked the board to vote on a new employment contract for him. It looked like a reform measure, since it reduced his golden parachute.
But the contract contained an inconspicuous provision giving Mr. LaPierre authority “without limitation” to “reorganize or restructure the affairs of the Association for purposes of cost-minimization, regulatory compliance or otherwise.”
The new contract was first presented to a committee of the N.R.A. board in a closed session on Jan. 7. There weren’t enough copies to go around, and no one could leave with a copy. N.R.A. officials said board members had ample time for review.
By that time, Mr. LaPierre’s main outside counsel, the law firm of William A. Brewer III, had spent months planning the bankruptcy, racking up millions of dollars in legal fees. But no one told the board about that. After the committee emerged from its closed session, the board approved the contract, with little inkling that they had conferred bankruptcy authority on Mr. LaPierre.
When the petition was filed a week later, one board member said he was so shocked that “his head almost exploded,” said Brian Mason, an Ackerman lawyer, in his opening statement. That board member, Phillip Journey, a family court judge in Kansas, has asked Judge Hale to allow the bankruptcy to continue but to hire an examiner, who would work for the court to find and “eradicate any mismanagement.”
Another person caught unawares by the filing was the N.R.A.’s general counsel, John Frazer. Mr. LaPierre conceded in court he had also not told the N.R.A.’s chief financial officer or its top lobbyist.
“There’s a real question whether the employment contract was a legitimate authorization for bankruptcy,” said David A. Skeel, a law professor at the University of Pennsylvania who studies bankruptcy. “The language is quite vague. It could be construed as simply allowing Wayne LaPierre to make cost-saving organizational changes, not to file a bankruptcy petition.”
He also said that corporate law does not normally permit boards to delegate bankruptcy decisions to a single officer or committee.
N.R.A. officials said that the board voted weeks after the filing, in March, to approve the bankruptcy, and that board members should have known that the language in the employment agreement meant Mr. LaPierre could declare bankruptcy unilaterally.
But during the proceedings last week, G. Michael Gruber, a lawyer for Ackerman, asked Mr. LaPierre if board members “were in a better position to understand the meaning of your employment agreement, as far as it allowing you to file a Chapter 11 petition” than “the general counsel of the N.R.A.?”
“No,” Mr. LaPierre replied. The trial resumes this week.