AAA issues statement on legal battle over Armenian Genocide Museum

AAA issues statement on legal battle over Armenian Genocide Museum

PanARMENIAN.Net - Armenian Assembly of America issued a statement on The Armenian Genocide Museum case.

“Last month the U.S. District Court in Washington, DC issued an order and an accompanying 190-page Memorandum of Opinion regarding the Armenian Genocide Museum case. Although the case is not over, it is important for all members of the Assembly to understand the ramifications of the Opinion. It is also important for all members of the Assembly to know that we have worked tirelessly to build a museum and permanent memorial to the Armenian Genocide in our nation's capital. Nothing in the Opinion will stop us from continuing these efforts.

This litigation began in April 2007, when Mr. Cafesjian and his foundation sued the Assembly and the Armenian Genocide Museum & Memorial (AGMM). In its Opinion, the Court rejected Mr. Cafesjian's claims of wrongdoing against the Assembly and AGMM, and reduced Mr. Cafesjian's representation on the Board of Trustees. Going forward, the Judge decided that Anoush Mathevosian, Hirair Hovnanian, the Armenian Assembly of America, and the Cafesjian Family Foundation will each have one vote on the AGMM Board. The Judge also decided that Mr. Cafesjian is not entitled to the payment of $500,000 that he claimed he was owed from the AGMM.

However, the Court upheld Mr. Cafesjian's right to insist upon the return of the real estate acquired to house the museum complex, which was estimated at $40 million at trial. This right arose through a reversionary clause Mr. Cafesjian included in the documents that transferred these properties to AGMM. The clause stated that if the museum was "not developed prior to December 31, 2010 in accordance with the Plans" or "in substantial compliance with the Plans," then at Mr. Cafesjian's "sole discretion" he could insist on the return of his funds or the properties. The Judge concluded that the AGMM was not developed prior to December 31, 2010, therefore entitling Mr. Cafesjian to enforce his right of reversion. The Court also denied the allegations of the Assembly and AGMM against Mr. Cafesjian, and ruled that Mr. Cafesjian's indemnification for the legal fees will be addressed in further court proceedings.

The Court is now going to balance Mr. Cafesjian's right to a return of the properties against the principle enshrined in our bylaws that no trustee can profit from a transaction with the Assembly or AGMM. We will also ask the Court to consider the applicable IRS rules and regulations governing non-profit entities, and the intention of the parties at the time he obtained his right of reversion.

The Judge will begin considering these issues at a hearing on February 24. The Judge also encouraged the parties to resolve their differences to "accomplish the laudable goal of creating an Armenian genocide museum and memorial."

The Assembly is keenly aware that our members and the community have many questions. Our attorneys continue to represent and advise us, and while many have expressed their surprise and concern regarding the reversionary clause and its validity, it is important to note that Mr. Cafesjian should not profit from exercising it.

While this matter is pending, the Assembly must also address another lawsuit brought by Mr. Cafesjian filed in January of this year. In addition to suing the Assembly, Mr. Cafesjian is also suing Hirair Hovnanian and Van Krikorian personally. That suit seeks the return of $1,050,000 in trustee dues by Mr. Cafesjian, which he claims a right to receive back due to an alleged lack of participation in the governance of the Assembly.”

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