After suffering a legal defeat in a Texas bankruptcy court and the possibility that one of its board members will appeal the decision, the National Rifle Association has some options moving forward, but bankruptcy experts are skeptical that many of them will turn out well for the gun rights organization, Reuters reported. In a 38-page decision issued on May 11, U.S. Bankruptcy Judge Harlin Hale made clear that he did not think the NRA’s January bankruptcy filing was made in good faith. He threw out the chapter 11 case, saying the NRA was trying to use bankruptcy to gain an unfair advantage in a lawsuit brought by New York Attorney General Letitia James that aims to dissolve the organization. Though the NRA itself has not indicated that it will appeal, a lawyer for one of its board members said during a virtual status conference before Judge Hale on Friday that he was considering an appeal. But overturning Hale’s decision seems unlikely, said Anthony Casey, a bankruptcy and business law professor at the University of Chicago Law School. An appeals court would have to consider “whether he abused his discretion in deciding to dismiss it rather than doing something else like appointing a trustee,” Casey said. “But that would be a very high standard for someone to get the judge reversed on.” The board member, Phillip Journey, who is also a Kansas state judge, had been critical of the manner in which the NRA filed for bankruptcy. The board and many top officials were unaware that CEO Wayne LaPierre was making the move until after the fact. Journey asked Judge Hale to appoint an independent examiner to investigate management, but Hale denied that motion in conjunction with his dismissal of the bankruptcy.
