NMMI lawsuit moves to Carlsbad

July 3, 2013 • Local News

Chaves County District Court judges bowed out of hearing the New Mexico Military Institute’s lawsuit against its expelled Alumni Association, sending the contentious litigation [auth] to Eddy County.

The Institute filed the suit June 10 at the Chaves County Courthouse, asking the court to freeze all Association accounts—including $5.2 million in a Wells Fargo brokerage account and an estimated additional $1 million in unrestricted funds.

The case was assigned to 5th Judicial District Judge Steven Bell, who recused himself, or asked the court to be removed, June 18.

The court then reassigned the case to DistrictJudge Charles Currier, who asked to be recused Thursday.

The case was reassigned Friday to Judge Jane Shuler-Gray in Carlsbad. Gray, who was elected in 2006, is the first woman to serve as a district judge in the district. She presides over civil and criminal cases.

The Institute’s Board of Regents ended its nearly 50-year relationship with the Association in April. After a failed negotiation period between the Institute and the Association, the non-profit was locked out of its offices on campus.

The Institute has since opened its own Office of Alumni Services.

The Institute’s lawsuit asks the court to freeze the Association’s funds “to preclude waste and misuse of the corporate assets;” stop the Association from using the Institute’s logos, trademarks and name; place its funds into a trust until issues of management are resolved; appoint a receiver to handle the funds; and order the Association to account to the Institute for the funds it has received.

The Institute also asks the court to order the Association to transfer all monies it received for a charitable purpose to the NMMI Foundation—the Institute’s non-profit arm that is supported by earnings on investments and revenues from real estate sales, operations and other donations.

The Association’s newly named president, John Phinizy, vowed mid-June to “vigorously defend” the Association against NMMI’s lawsuit and maintain control of the funds.

The group continues to operate as a non-profit and seek contributions. Phinizy confirmed during an interview June 20 that the Association hired an executive director, an accountant and an attorney.

The Association also signed a three-year, $1,200 lease for office space at the Best Western Sally Port Inn & Suites on North Main Street, according to ex-Association member Jerry Phifer.

Oddly, the Sally Port Inn leases its land from NMMI’s Foundation.

Positive Investments Inc., of California, bought the hotel in 2006 and its remaining lease, owned by the “New Mexico Military Institute Foundation Inc.” according to the Chaves County Assessor’s Office.

The Foundation will meet 10 a.m. Friday, July 12.

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