American Lung Association severs ties with Northwest chapter

Published 11:25 pm Friday, October 31, 2008

SEATTLE — The American Lung Association has cut ties with its Northwest chapter, saying the affiliate veered away from its mission — and sold its multimillion-dollar Seattle headquarters for $10.

The national charity said Friday that it sent a cease-and-desist letter to the American Lung Association of the Northwest, which represents the organization in Alaska, Washington and Idaho. The letter demanded that the regional affiliate stop using the American Lung Association name, turn over its financial assets and take steps to get the building back.

“We took these steps in order to protect these assets, which were intended for the purpose of advancing the mission of the American Lung Association,” Carrie Martin, a Washington, D.C.-based spokeswoman for the national association, said in an e-mail.

The American Lung Association, founded in 1904, gave the Northwest affiliate notice in mid-September that it was in violation of several of the organization’s policies. If those issues weren’t fixed in 30 days, it said it would cut ties with the Northwest affiliate, which has been operating here since 1906.

The sides spent two days in mediation in Washington, D.C., this week, but failed to reach agreement. The alleged policy violations included that the Northwest affiliate had tried to change its mission statement and forbid its staff members from speaking with national staff, hindering day-to-day operations of both organizations.

Most troubling, the American Lung Association said, was that without permission, the regional affiliate’s chief executive set up a separate corporation called the Pacific Northwest Lung Cancer Foundation.

Real estate records show that in August, the Northwest affiliate transferred its $3.2 million Seattle headquarters to the new lung foundation for $10. In addition, the American Lung Association of the Northwest then transferred $600,000 to the new foundation in exchange for five years’ rent in the building it used to own, Mike Alderson, president and chief executive of the affiliate, acknowledged in a court deposition.

In early October, the American Lung Association obtained a temporary restraining order in King County Superior Court, barring Alderson from violating the operating agreement that governs the relationship between the two organizations. The agreement says each organization must “hold all their funds and other assets in their own names.”

In a court deposition, Alderson said he and two other “concerned community members” established the Pacific Northwest Lung Cancer Foundation in case the national organization tried to dissolve the operating agreement, but he didn’t say why he thought that might happen. Court documents indicate that the Northwest affiliate was having financial problems and there was concern among some board members that the national organization might seize control of it.

Alderson repeatedly indicated in a court declaration that his chapter was not under the control of the national charity and could “operate its business as it sees fit.” He has ignored recent requests for interviews, including an AP call for comment Friday.

Laird Harris, chairman-elect of the Northwest affiliate’s board, did not immediately return a message left on his cell phone Friday, but told the AP before entering mediation that he considered the dispute a “misunderstanding” and said there were “sound business reasons” for transferring the building.

Alderson started with the Northwest chapter in June, and according to Steve Nolan, chairman of the American Lung Association, that’s when things turned sour.

“The ALA and the ALA-NW have had a long, stable relationship covering a period of decades,” Nolan said in court. “That changed abruptly … when Mike Alderson took over.”

Alderson directed that all calls from the national organization to staff in Washington, Idaho and Alaska be routed through his assistant; he said in his declaration it was to keep the national charity from “meddling.” His assistant also sent an e-mail declaring a new mission statement: instead of “preventing lung disease and promoting lung health,” it was about helping individuals who have lung disease and helping prevent future lung disease. The Northwest affiliate’s board never approved the change.

“The ALA’s goodwill, established over the last 100 years, is one of the ALA’s most important assets,” Nolan said.

The national organization was founded to fight tuberculosis, but now works to prevent all forms of lung disease, focusing on asthma, smoking and air pollution. It has 14 affiliates around the country, and conducts direct-mail fundraising for those chapters. Money raised in each region stays in that region, with the national lung association keeping a slice for administrative costs.