Southwestern Seminary and Baylor are suing the Harold E. Riley Foundation and its trustees over what they allege is an illegal attempt to divert funds from the schools contrary to the foundation’s purpose and bylaws. I skimmed the lawsuit and read the story, but I cannot pretend to have an in-depth knowledge of the facts of this case. You can read the full story in the Religion News Service story on the lawsuit, by Bob Smietana. The lawsuit itself is available in PDF form. The suit alleges that the Riley Foundation was established in 2002 to provide funds for SWBTS and Baylor, granting the two schools the right to name a majority of the trustees of the board. According to the lawsuit, after Riley’s death in 2017, an effort was made by the Board of Trustees (people sympathetic to Paige Patterson, fired in May of 2018 from SWBTS for mishandling sexual abuse cases and other offenses) to rewrite the bylaws without notifying the two schools, stripping them of the ability to name trustees and changing the charitable purposes of the foundation.
The lawsuit names Foundation President Mike C. Hughes, Vice President for Advancement under Paige Patterson at Southwestern. The seminary sees the foundation’s actions as part of Patterson’s efforts to undermine support for the school since his removal.
The article quotes Colby T. Adams as saying, “This is but the latest in a two-year pattern of attempts to divert support away from the seminary to other causes. We have sought relief with heavy hearts but firm resolve to expose and stop ongoing efforts to cause harm to our students and generous ministry partners.”
Evidently, the Riley Foundation was a major contributor to Baylor and to SWBTS, but is not since the takeover by Patterson associates, as alleged in the lawsuit according to the RNS article.
The suit alleges that the board sold off more than 700,000 shares in Citizens Inc., the company founded by Riley, but shared only a fraction of those proceeds with the schools.
Before the changes in 2018, a spokesman for Baylor said, the school had received $1.125 million from the foundation. Since 2018, it has received $250,000.
There is another lawsuit concerning the board of Citizens Inc, as reported in the RNS article.
According to a separate lawsuit filed in Colorado, the foundation has the right to appoint a majority of members to Citizens’ board of directors because it owns Class B stock in the company. Earlier this year, according to the suit, the foundation board attempted to name Patterson and Hughes to the Citizens board. The foundation board also attempted to name three others to the Citizens board, all with ties to Patterson: David August Boto, a former vice president of the Southern Baptist Convention’s executive committee; Charles Hott; and J. Clinton Pugh.
The purpose of the lawsuit is to return the foundation to its original intent. They are seeking the resignation of the current Board. Again, from the RNS article:
Under the lawsuit, the two schools seek the removal of the foundation’s current trustees and a freezing of the foundation’s assets until the foundation’s original charitable purpose is restored.
“It is the strong desire of both Southwestern Seminary and Baylor University that this matter be resolved without the necessity of a trial,” Greenway said in a statement. “It is our further hope that we can settle this issue in the spirit of Christian charity by returning direction and control of the foundation to its beneficiaries and restoring the member status of both Southwestern and Baylor.”
This is another ugly episode in the final years of Paige Patterson’s ministry among Southern Baptists. May it be resolved fairly and according to the truth. Obviously, this lawsuit presents one side and though they refused to speak in response to this article, I am sure that Paige, Augie, and others have their side. It is hard to understand how they could feel justified in their actions, but that is why we have courts, I suppose. This is another black eye for our faith – a dispute between believers headed to secular courts.
Read the article and lawsuit for more information.