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On May 26, almost exactly two years following the Fort Bragg Footlighters' board meeting when they voted to transfer their Laurel Street theater building to Mendocino Coast Television, a new board president is suing the corporation, 20 unnamed individuals, and former Footlighters President Bud Farley.
(In the Aug 13 front page story, the first sentence should read "almost exactly three years following the Fort Bragg Footlighters' board meeting.... Two years refers to how long it's been since MCTV moved into the Laurel Street building. The chronology sets for the dates correctly.)
Footlighters Little Theatre staged original 1890s melodramas in the 248 E. Laurel St., Fort Bragg, building for many years. The individual representing Footlighters in the lawsuit is Junice Gleason, real estate agent; their attorney is John Ruprecht.
Mendocino Coast Television, formerly called MCCET, is the area's public, education and government access station.
The lawsuit filed by Gleason alleges that Farley acted beyond his authority to transfer the deed and was not authorized by the "bona fide board of directors."
Ruprecht asserts that none of the Corporations Code requirements were met, that the transfer of the deed "is a sham and an illegal transaction," and that MCTV is without legal right "whatsoever." The suit demands MCTV return the property to Footlighters and pay damages.
"Neither the board of directors nor the membership approved this transfer," the suit alleges, and MCTV was "unjustly enriched" by the transaction.
"Some four months (June 6, 2007) after recordation of the deed, Farley held a sham meeting without notice to the actual board of directors or members purporting to authorize the Footlighters to donate the building to MCTV.
"[MCTV Director] Elizabeth Swenson attended this meeting and encouraged Farley to transfer the building to MCTV."
The meeting Ruprecht refers to was held in 2006, not 2007.
The suit alleges numerous faulty actions were taken by Farley, including negligence and breach of his fiduciary duties, leading to the illegal transfer of the title.
Gleason wants the deed returned to Footlighters with full restitution plus damages in an amount to be proved at trial for damage/destruction of the property, or alternately, full cash fair market value of the property effective on the date of the transfer, plus damages.
According to the six-page undated Fort Bragg Footlighters Constitution, the president acts as the executive officer of the corporation.
"The president has been given sufficient power so that if the organization falls down at any place, the president can remedy the situation. The smooth running of the Footlighters is primarily the responsibility of the president."
Two committees of three members, Board of Policy Control and Board of Financial Control, determine policy matters and vote to make decisions. Meetings are open to all board members.
The official members of these board committees were present and voted for the decision to turn over the Footlighters building to MCTV at two meetings held in June and July 2006.
The "General Policy" section states, "In case the organization is ever dissolved, all assets are to be given to a worthy public service or charitable organization."
It was on the basis of these meetings and the organization's constitution that Farley, with the approval of board members at that time, completed the transfer of Footlighters property to MCTV in February 2007.
Chronology of events
- June 27, 2006: Handwritten meeting minutes by Farley indicate there were nine paid members of Footlighters, six of whom were present for the meeting and represented the required quorum. Roll call denotes that the elected officers were present: President, vice-president, secretary, treasurer, financial and policy control board, as well as "Linn, Kate and Charles."
"Moved and seconded, Charles and Shirley [Frey], to donate building to MCCET. A vote was called for and it was unanimous to donate the building."
The members voted to carry out the final disposition at the next regular meeting.
- July 11, 2006: Farley's handwritten minutes indicate that of the nine paid members, seven were present, including elected officers Farley, Secretary-Treasurer Pro-tem B. Lyn, Financial Control Board member Shirley Frey, Policy Control Board member Darlene Dean, as well as members "Kate, Charles and Jessey."
"Discussion on transfer of building to MCCET with much concern for the present appearance of our image to the community, power given to the president and along with the secretary Pro Temp, [to] transfer the title to MCCET."
There's a notation to send a report to each "paid-up" member.
Farley inaccurately dated the entry for 2007, instead of 2006.
The next month the Advocate-News reported the donation of the building to MCTV.
- July 24, 2006: City of Fort Bragg proclamation honoring Footlighters Little Theatre, whereas "Footlighters has decided it is appropriate for its famous building ... to expand its mission and become the new home ... for Mendocino Coast Television" and whereas, "Footlighters Little Theater deserves high praise for this vision to extend the life of this historic building."
The proclamation was signed by then Mayor Dave Turner and City Clerk Cynthia VanWormer.
- Aug. 15, 2006: Advocate staff article, "
MCCET dissolves, MCTV forms; Offered Footlighters building"
One day in June, Bud Farley [then president of Footlighters] walked into the cramped space MCCET occupies at the high school and told Executive Director Elizabeth Swenson that Footlighters was planning to dissolve and needed to pass its theater building to a non-profit organization.
Swenson, surprised, said Farley announced, "MCCET was at the top of the list."
At a subsequent meeting, the Footlighters board decided not to dissolve. Instead, it's revising its bylaws, but is moving forward with its plans to deed the building to MCTV.
Instead of dissolving and "falling out of sight," Farley reports that Footlighters has decided to try giving an annual weekend show beginning next year.
Fort Bragg City Council member Dan Gjerde said, "By selecting MCTV as the custodian of this historic building, they have found a way to make life better for everybody on the coast."
Farley explained that they could sell it and pass the money on to an eligible organization, but they don't want the building to be used for a commercial venture.
"We're happy they're getting it and we'll give them our wholehearted support," he said.
According to Swenson, the building was last assessed in 1980 for $29,800.
- Feb. 21, 2007: Official "Quitclaim Deed" document from Marsha A. Wharff, Mendocino County clerk-recorder, signed by Farley, "The Fort Bragg Footlighters does hereby remise, release and forever quitclaim to Mendocino Coast Television all of its interests in the real property ...."
"The undersigned [Farley] declares the transfer tax is $0; gift transfer R&T Code 11930."
- May 24, 2007: Newspaper headline, "Signs of new life at Footlighter building" by Elizabeth Swenson, "There's lots to celebrate: That the Footlighters gave the local public access station this building, that MCTV will finally have a studio and that the building will become a new space for community use."
- May 31, 2007: Newspaper headline, "MCTV holds party, prepares for move into Footlighters, " with a photo of Fort Bragg Councilman and MCTV Board member Dan Gjerde wielding a paintbrush). "MCTV staff and volunteers have been working on the building for months ...."
- June 7, 2007: Newspaper headline, "MCTV hosts party in new building." The story opens with, "About 125 people came Friday night to the Footlighters Little Theatre building ... to welcome Mendocino Coast Television into its new home."
Following a Chamber of Commerce ribbon cutting, Swenson thanked the Footlighters board of directors and members.
- June 14, 2007: Newspaper headline, "Supervisors meet on the coast" notes that the Board of Supervisors held a meeting in Fort Bragg Town Hall and toured the Footlighters building "that is MCTV's new home."
- Aug. 4, 2008: Attorney John Ruprecht advised Swenson by letter that he had been retained by the current president and vice president of Footlighters to investigate the transfer of the building to MCTV, indicating the two new officers are "unaware of any proper board of directors resolution authorizing" the transfer of the property.
- Aug. 28, 2008: Swenson responded to Ruprecht's questions in a two-page letter, reiterating much of the information published in newspaper articles and other documents.
- Sept. 8, 2008: Ruprecht replied to Swenson (his letter incorrectly dated as Aug. 25), and stated, "I am dealing with the current president and vice-president of the Footlighters [names were withheld] who seriously question whether the so-called board' was properly constituted and whether Mr. Farley had legal authority to take the action he did in transferring the real property."
- Sept. 11, 2008: Swenson responded and sent relevant documents that attorney Jone Lemos used to arrange the deed transfer.
"To make an effort to discredit the decision of the Footlighters board and members after MCTV has put a huge amount of energy and money into repairing the building that was in serious disrepair from years of neglect is incredulous," Swenson wrote.
- Sept. 25, 2008: Newspaper headline, "MCTV needs community support for Footlighters fixup," story submitted by Elizabeth Swenson.
The Community Foundation granted MCTV $4,000 in July 2007 to develop a plan for the historic Footlighters building. When Fort Bragg Rotary volunteers took down the front stage, MCTV discovered the floor and foundation were badly warped, unsupported and not usable. Repairs had to be scheduled much sooner than planned. Structural engineer David Duncan donated his time; MCTV chose Jerry Matson Construction as the contractor.
Once the little stage was demolished it was evident it was cracked and sagging and had to go. The good news is a cement floor will mean this building will be able to stand for another 100 years. The renovation is funded from $25,000 in savings and $40,000 financed from a three-year private low-interest loan from a supporter. MCTV will repay the loan using about 50 percent of the next capital grant from Comcast which is in 2011.
- Oct. 30, 2008: "Before you send me another misguided letter, I strongly suggest you seek competent legal counsel," Ruprecht wrote back. Here are excerpts from his letter:
"The so-called procedures which Mr. Farley went through to transfer the deed are a legal farce.
"Despite your claims of righteous indignation, there has been a terrible injustice to the members of the Footlighters perpetrated here. Bud Farley acted totally outside of the legal requirements and will be held accountable for his actions.
"It is therefore demanded that MCET re-convey the real property and building illegally transferred to it.
"Failure to reconvey the property will result in litigation to void this sham and collusive transaction."
- Nov. 25, 2008: Attorney Jone Lemos, representing MCTV, wrote Ruprecht that unless he could produce documents refuting those provided by Swenson, showing that there were other paid members beyond the nine noted by Farley and that a quorum was not present, "I believe the meeting and vote were valid."
"MCTV has in fact paid all taxes and insurance for the property since its transfer, and has put between $70,000 and $100,000 in improvements into the building. To suggest that MCTV simply deed the building back after MCTV has substantially changed its position in reliance on the Footlighters' representations is unreasonable.
"Whether Footlighters complied with requirements to obtain Attorney General approval of the transfer is again not a concern of MCTV. Nor is it a concern whether Footlighters has or has not dissolved, or whether they complied with the legal requirements for dissolution."
"MCTV did not seek out this relationship, but stepped in when approached by Mr. Farley and has worked diligently since then to preserve the property for the benefit of the community.
"I am interested in knowing on what basis you accuse MCTV of collusion and hope you will provide me with the facts you have to support this accusation."
- Feb. 5, 2009: Ruprecht pursued the issue of Farley mis-dating the minutes of the June and July 2006 meetings as 2007, despite Lemos pointing out that the Advocate-News immediately published articles in 2006 announcing the transfer.
Ruprecht also wrote, "We have not discussed the issue of unjust enrichment. MCET has been unjustly enriched."
"It will be up to the principals of the Footlighters if they wish to litigate. However, I must strongly and respectfully disagree with your analysis if this matter.
- May 26, 2009: Ruprecht filed for action to recover the building for Footlighters.
- July 20, 2009: Lemos was served with the Notice and Acknowledgment" of the suit against MCTV and Bud Farley.
- Aug. 5, 2009: MCTV held a board meeting and discussed a course of action. The organization cannot afford an attorney to fight the suit and seeks one to provide pro bono legal aid.
Footlighters building repairs
Basic essential repairs made by MCTV in the past two years: MCTV paid for the following basic essential repairs using funds saved from the 2007 Cable Capital Grant and borrowed $40,000 they have to pay back in 2010 when they receive their next cable capital grant.
- $2,500, electrical panel: Main outside box corroded, sending sparks and uneven electricity; replaced early 2008
- $2,100, electrical panel: Main inside box sparking; replaced fall 2008
- $1,000, temporary emergency repair of floor with new support: About 300-square-foot front area. Staff and volunteer labor, material costs for cement piers, cement pouring, plywood. Work had to be done before moving in.
- $69,500, replace floor/foundation, include putting in French drain to correct problem that caused floor foundation damage.
The $75,100 total does not include building permits, engineering, plan drawing, etc. that came to about another $5,000.
Other essential work:
- $3,000, retrofit space and built and wired a room with a level floor for equipment.
- $2,000, repair bathroom pipe leaks, create new bathroom.
- $5,000, electrical wiring and fluorescent fixtures for an office (not complete). They have a volunteer electrician.
- $1,600, for heater for main office area.
Additional work to complete a functional studio, estimate $15,000 to $20,000
- $5,000 estimate, heater for studio part of building
- $3,000 flooring, recycled rubber for sound reduction
- $2,000, lighting grid
- $1,000, painting room
- $1,000, insulation in north and south walls
- $2,000, soundproofing, sheetrock, sliding glass door, etc., to finish control booth
- $1,000, reinstall original "high" windows
To open as a public venue
- Estimate $250,000 to $300,000 to build ADA compliant bathrooms and repair/replace floor/foundation to the front of the building.
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