Who Can Sue a Nonprofit Board?
Directors and Officers Liability Insurance is designed to provide coverage against wrongful acts which might include actual or alleged errors, omissions, misleading statements, and neglect or breach of duty on the part of the board of directors. Most lawsuits filed against nonprofit boards are filed by current and former employees (alleging wrongful employment practices). However, nonprofits serve a large and often varied constituency to which their boards owe specific fiduciary duties. These constituencies are potential plaintiffs in legal actions against nonprofit boards. Potential claimants in a suit against non-profit directors include: Insidersthe current and former staff of a nonprofit may bring actions alleging a host of wrongful acts, including wrongful termination, discrimination, sexual harassment, and Americans with Disabilities Act violations. OutsidersThird parties that have a relationship with the nonprofit may allege harm caused by the nonprofit and/or its directors, off
