PRELIMINARY STATEMENT
1. Plaintiffs, who are members, contributors, and leaders of
defendant PACIFICA FOUNDATION, bring this action to restrain and
enjoin the unlawful and undemocratic actions of a majority of
the Foundation’s Board of Directors. The Board of Directors, without
proper notice and in excess of its lawful authority, has purported
to amend the Foundation’s bylaws to eliminate the membership’s
role in the election of directors and to thereby create a self-perpetuating
Board without any accountability to the members and subscribers
of the Foundation. Unless restrained, the Board now threatens
to utilize its newly created powers to abandon the mission and
historic role of the Pacifica radio network and threatens to sell
one or more of the Foundation’s five radio stations.
PARTIES AND JURISDICTION
2. Plaintiff DAVID ADELSON is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member and acting chair of the
Local Advisory Board for Pacifica Radio Station KPFK in Los Angeles,
California.
3. Plaintiff LAUREN AYERS is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station KPFA in Berkeley, California.
4. Plaintiff LYDIA BRAZON is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station KPFK in Los Angeles, California.
5. Plaintiff CECILIA CARUSO is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station WBAI in New York, New York.
6. Plaintiff GAIL DIXON is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station WPFW in Washington, D.C.
7. Plaintiff ANNE EMERMAN is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station WBAI in New York, New York.
8. Plaintiff SHERRY GENDELMAN is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member and chair of the Local
Advisory Board for Pacifica Radio Station KPFA in Berkeley, California.
9. Plaintiff TERRENCE GUY is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station KPFK in Los Angeles, California.
10. Plaintiff JIM HORWITZ is a member of defendant PACIFICA FOUNDATION
within the meaning of Corporations Code §5056, a donor to
the Foundation, and a member of the Local Advisory Board for Pacifica
Radio Station KPFK in Los Angeles, California.
11. Plaintiff KAHLIL JACOBS-FANTAUZZI is a member of defendant
PACIFICA FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station KPFA in Berkeley, California.
12. Plaintiff DAWUD KHALIL-ULLAH is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station KPFK in Los Angeles, California.
13. Plaintiff PELE DE LAPPE is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station KPFA in Berkeley, California.
14. Plaintiff STEVE LUSTIG is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station KPFA in Berkeley, California.
15. Plaintiff ERROL MAITLAND is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station WBAI in New York, New York.
16. Plaintiff ANDREW NORRIS is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station WBAI in New York, New York.
17. Plaintiff LEWIS O. SAWYER JR. is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station KPFA in Berkeley, California.
18. Plaintiff MARIALICE WILLIAMS is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member and chair of the Local
Advisory Board for Pacifica Radio Station WPFW in Washington,
D.C.
19. Plaintiff FRIEDA ZAMES is a member of defendant PACIFICA
FOUNDATION within the meaning of Corporations Code §5056,
a donor to the Foundation, and a member of the Local Advisory
Board for Pacifica Radio Station WBAI in New York, New York.
20. Each of the plaintiffs named above brings this action on
his or her own behalf and as a derivative action pursuant to Corporations
Code §5710 on behalf of the Pacifica Foundation.
21. Plaintiffs also bring this action on behalf of all other
persons similarly situated, that is, persons who have made financial
contributions to defendant PACIFICA FOUNDATION based upon their
understanding that the Board of Directors of PACIFICA FOUNDATION
would utilize such funds to carry out the long-standing and historic
purposes of the PACIFICA FOUNDATION. The class of persons whom
plaintiffs seek to represent in this matter is ascertainable,
but its members are so numerous that it would be impractical to
join them all in this action.
22. Defendant PACIFICA FOUNDATION is a California Nonprofit Corporation
with its headquarters and principal place of business in the City
of Berkeley, County of Alameda.
23. Defendants MARY FRANCES BERRY, DAVID ACOSTA, JUNE MAKELA,
ANDREA CISCO, FRANK MILLSPAUGH, JEWELLE TAYLOR-GIBBS, KEN FORD,
ROBERT FARRELL, MICHEAL PALMER, WILLIAM LUCY, AARON KRIEGEL, ROB
ROBINSON, PETER BRAMSON, and Doe 1 through Doe 10 are and were
at all times relevant hereto the directors of the defendant PACIFICA
FOUNDATION.
24. The true names and capacities of the defendants named herein
as Doe 1 through Doe 25, inclusive, whether individual, corporate,
associate, or otherwise, are unknown to plaintiffs, who therefore
sue such defendants by fictitious names pursuant to Code of Civil
Procedure section 474. Plaintiff will amend this complaint to
show their true names and capacities when they have been determined.
25. Plaintiffs are informed and believe, and based on that information
and belief allege, that at all times mentioned in this complaint
defendants were the agents and employees of their codefendants
and in doing the things alleged in this complaint were acting
in the course and scope of such agency and employment.
STATEMENT OF FACTS
26. The Pacifica Foundation was incorporated on August 24, 1946,
by Lewis Hill, H. Don Kirschner, Homer Sisson, William Triest,
and John Waldron.
27. The Articles of Incorporation of the Pacifica Foundation,
as filed with the Secretary of State of the State of California
on August 20, 1948, and at all times since said date, have stated,
and do now state, that the purposes of the Pacifica Foundation
are, inter alia: "to establish and operate for educational
purposes…one or more radio broadcasting stations;" "to encourage
and provide outlets for the creative skills and energies of the
community;" "to…contribute to a lasting understanding between
nations and between the individuals of all nations, races, creeds,
and colors; to gather and disseminate information of the causes
of conflict between any and all of such groups;… to promote the
study of political and economic problems and of the causes of
religious, philosophical and racial antagonisms;" "to promote
the full distribution of public information; to obtain access
to sources of news not commonly brought together in the same medium;
and to employ such varied sources in the public presentation of
accurate, objective, comprehensive news on all matters vitally
affecting the community."
28. Consistent with the purposes set forth in Articles of Incorporation,
the Pacifica Foundation now owns and operates five listener supported
and publicly supported radio broadcasting stations in the cities
of Berkeley, California; Los Angeles, California; New York, New
York; Washington, D.C.; and Houston, Texas.
29. In order to carry out its purposes and mission as described
above, the Pacifica Foundation has solicited donations from plaintiffs,
and the class they represent, for the purposes of acquiring and
operating its five radio broadcasting stations. In soliciting
such contributions, and in continuing to do so to the present
day, the Pacifica Foundation has explicitly represented to plaintiffs
and to the class they represent, that all funds so contributed
would be utilized to assist the Pacifica Foundation in carrying
out its purposes and mission as set forth above and in its Articles
of Incorporation.
30. Plaintiffs, and the class they represent, have contributed
millions of dollars to the Pacifica Foundation. In doing so, they
have relied upon the explicit assurances of the Pacifica Foundation
that the funds they contributed would be utilized solely for the
purposes of carrying out the mission and purposes of the Pacifica
Foundation as set forth above and in its Articles of Incorporation.
31. At all times since August 24, 1946, the Articles of Incorporation
of the Pacifica Foundation have provided that the Pacifica Foundation
would be governed by its directors and that the number of directors
and their method of election would be as set forth in the Bylaws
of the Pacifica Foundation.
32. As of and since September 30, 1961, the Bylaws of the Pacifica
Foundation have provided that: "There shall be such number of
directors as the Board of Directors shall from time to time decide."
33. Beginning on January 9, 1988, and perhaps earlier, the Bylaws
of the Pacifica Foundation provided that:
SECTION 2 ELECTION OF DIRECTORS: In order to be elected,
a member must
receive the nomination and vote of a majority of the station
board which s/he
represents, unless such member is classified as an "at large"
member, in which
event s/he must be elected by a 2/3 vote of the Board of Directors
of the Foundation,
voting by secret ballot, subject to approval of FCC council
or FCC.
34. Pursuant to the Bylaw provision set forth above and the procedures
that the Pacifica Foundation adopted pursuant thereto, each station
board (also known as "Local Advisory Board") chose two members
of the Board of Directors of the Pacifica Foundation. Likewise
pursuant to such procedures, the number of at large members of
the Board of Directors was limited to a number not to exceed one-half
of the number of station representatives.
35. On or about February 28, 1999, the Board of Directors of
the Pacifica Foundation purported to amend the Foundation’s bylaws
to provide as follows: (1) to eliminate the role of the station
boards in choosing members of the Pacifica Board of Directors;
(2) to vest all authority for nominating members of the Board
of Directors in the Board of Directors’ "Board Development Committee;"
and (3) to provide that all members of the Board of Directors
would be elected by majority vote of the Board of Directors.
36. Since February 28, 1999, the Board of Directors has and threatens
further to abandon the mission and purposes of the Pacifica Foundation
as set forth in its Articles of Incorporation by eliminating diverse
and community oriented programming from Pacifica’s radio stations
and by threatening to sell one or more of Pacifica’s radio stations
to commercial broadcasting companies in order to realize a profit.
37. Since February 28, 1999, defendants have utilized the resources
of the Pacifica Foundation for improper purposes, including but
not limited to, the hiring of armed guards to prevent staff and
volunteers from carrying out their work at Pacifica Station KPFA
in Berkeley. On information and belief, defendants have further
utilized the resources of the Pacifica Foundation for the purposes
of marketing the Foundation’s radio broadcasting stations.
DEMAND ON BOARD OF DIRECTORS
38. On June 14, 1999, plaintiffs, through counsel, informed the
Board of Directors of the Pacifica Foundation, in
writing, of the ultimate facts and contentions set forth in
this complaint, and requested that the Board take action to remedy
and rectify the concerns set forth herein.
39. On June 28, 1999, the Board of Directors of the Pacifica
Foundation, through staff, advised plaintiffs that it rejected
their contentions and would take no action upon their requests.
FIRST CLAIM FOR RELIEF
(California Corporations Code)
40. Plaintiffs hereby incorporate as though fully set forth herein,
the allegations set forth in paragraphs 1-39 above, inclusive.
41. Pursuant to the provisions of the California Corporations
Code, defendants were required to submit the proposed changes
in the Bylaws of the Pacifica Foundation that were considered
on February 28, 1999, to the members of Pacifica’s local advisory
boards for their consideration and vote.
42. Defendants failed to submit the proposed bylaw changes to
members of Pacifica’s local advisory boards for their consideration
and vote.
43. By virtue of the foregoing, defendants violated their obligation
to submit proposed changes in the Bylaws of the Pacifica Foundation
to members of the corporation, including plaintiffs, for their
consideration and vote.
SECOND CLAIM FOR RELIEF
(Breach of Articles of Incorporation and Bylaws)
44. Plaintiffs hereby incorporate as though fully set forth herein,
the allegations set forth in paragraphs 1-43 above, inclusive.
45. Pursuant to the Bylaws of the Pacifica Foundation, defendants
were required to give notice of the exact text of the proposed
bylaws changes to the members of the Board of Directors along
with the notice of the meeting for February 28, 1999.
46. Defendants breached the Bylaws of the Pacifica Foundation
by failing to to give notice of the exact text of the proposed
bylaws changes to the members of the Board of Directors along
with the notice of the meeting for February 28, 1999.
47. Defendants have breached the Articles of Incorporation of
the Pacifica Foundation by allowing the resources of the Foundation
to be utilized for purposes contrary to those set forth in the
Articles of Incorporation.
48. Defendants have breached the Bylaws of the Pacifica Foundation
by choosing members of the Board of Directors executive committee
and extending the terms of members of the Board of Directors in
a manner inconsistent with the Bylaws.
THIRD CLAIM FOR RELIEF
(Unfair Business Practices)
49. Plaintiffs hereby incorporate as though fully set forth herein,
the allegations set forth in paragraphs 1-48 above, inclusive.
50. By virtue of the foregoing, defendants have committed unfair
business practices and damaged plaintiffs and the class they represent.
WHEREFORE, plaintiffs request that this Court order relief as
follows: