Naming Rights Motivate Donors, But Also Lawsuits

February 2, 2012 Posted by The Law Firm for Non-Profits, P.C. in Board, Fundraising, News

If your organization has ever considered offering naming rights to motivate donors, just know that if you offer it, you better mean it.

Last week jurors ruled that Integris Hospital had to not only return a $500,000 donation from Garth Brooks, but also had to pay an additional $500,000 in punitive damages. According to Brooks, he believed the donation would be used to build a new women’s center named after his mother. But the new women’s center was never built, so he sued.

This ruling doesn’t come as a surprise to charities. In recent years, such venerable institutions as Lincoln Center and Vanderbilt University have dealt with angry heirs when plans were announced to erase decedent names for rehabbed buildings.

Making sure that your organization has a clear naming rights policy in place is critical. So is communicating clearly with donors so they know exactly what to expect when contributing.

Experts expect Integris will appeal the ruling. We will continue to monitor developments.

NOTE: The information contained herein is not intended to be legal advice and the reader should know that no Attorney-Client relationship or privilege is formed by the posting or reading of this article which is also not intended to solicit business.

Casey Summar, Partner, The Law Firm for Non-Profits,1812 W Burbank Blvd, #7445, Burbank, CA 91506

Comments are closed.