The Nonprofit
A transitional housing program serving clients recovering from alcohol or substance abuse.
The Situation
The clients are required to pay subsidized rent and actively participate in the recovery programs. One client was not doing either, so with the approval of the nonprofit’s own legal counsel, the nonprofit had the client removed.
The client, acting as his own attorney, filed suit in both federal and state courts, demanding seven figures in emotional distress damages.
The Resolution
The case went to a jury trial and the member was able to obtain a defense verdict based on the nonprofit’s clear records and a subsequent compliance finding by the funding agency. However, legal costs were incurred.
From the Claims Files stories like the one above are intended to be informational in nature. Please contact your insurance broker and/or agent for your specific coverage implications based on your specific situation.