City battling LA Zoo fund-raising group over $50 million surplus
City battling LA Zoo fund-raising group over $50 million surplus
A judge has issued a preliminary injunction preventing a nonprofit that has helped operate and develop the Los Angeles Zoo for more than 60 years from taking actions that the city alleges would misuse $50 million in surplus funds meant for the zoo’s benefit.
Los Angeles Superior Court Judge Kerry Bensinger heard arguments on the city’s request for injunctive relief against the Greater Los Angeles Zoo Association (GLAZA) on June 16. He took the case under submission and granted the motion in part of on June 25.
The injunction stems from a lawsuit the city filed Dec. 20 against GLAZA, alleging breach of contract and the implied covenant of good faith and fair dealing as well as breach of fiduciary duty and conversion. The city also seeks an accounting and a judge’s declaration of the rights and duties of the parties.
GLAZA maintained that the injunction would restrict GLAZA’s ability to raise and use funds for the exclusive benefit of the zoo, regardless of donor intent.
“In fact, the city’s manufactured modification disregards express terms that it negotiated and agreed to, including GLAZA’s right to raise funds for its own operations and to continue to manage its endowment until its dissolution, as well as GLAZA’s status as an independent nonprofit public benefit corporation,” the GLAZA attorneys stated in their court papers.
GLAZA manages at least $50 million in an endowment and in other accounts made up of money that GLAZA raised on behalf of the city for the zoo’s benefit, the City Attorney’s Office stated. The city argued that those funds must be used only to benefit the zoo, and not for any other purposes.
“Unless a preliminary injunction issues, GLAZA can and will dissipate zoo funds for its post-contract operating and other expenses to the detriment of the zoo,” the City Attorney’s office stated.
“We are pleased that the court recognized that GLAZA did not raise funds on its own account or for its own benefit while under contract for the city,” said City Attorney Hydee Feldstein Soto. “As its name implies, the Greater Los Angeles Zoo Association was always a fiduciary and agent for the LA Zoo. It’s time for GLAZA to stop trying to keep funds raised for the benefit of and in the name of the city.”
GLAZA, founded in 1963, is appealing the judge’s ruling. Trial is scheduled March 29, 2027.
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