The following announcement went out to LOPSA members today:
As you may have heard, we have been made a party to litigation between Association Headquarters (AH) and USENIX. In September 2006, AH filed a breach of contract suit against USENIX, for AH's loss of revenue as a result of the contract between AH and USENIX. We currently use the services of AH for the staffing needs of LOPSA.
Recall that USENIX has planned to allow SAGE to spinoff as its own entity. Various members of that SAGE Board created LOPSA as an independent entity from both USENIX and SAGE. When we created that entity, we negotiated a new deal with AH which included substantial savings to LOPSA as well as different services. AH's breach of contract claim stems from the original agreement with USENIX, not with the agreement with LOPSA.
LOPSA had not been involved in the litigation until last month, when USENIX brought a Third-Party action against LOPSA bringing us into the litigation. USENIX has claims against us for contribution and indemnity. Our legal counsel has indicated that this means, in laymen's terms, that should a judgment be rendered in favor of AH, USENIX would seek monies from LOPSA to pay for the judgment. We clearly disagree with USENIX's claims and will defend this claim.
Our attorneys have spoken with the attorneys handling the case for AH, who have indicated that they are not seeking any damages against LOPSA and simply have no claim against LOPSA. AH would have no reason to sue LOPSA, a client in good standing, and in no way has taken hostile action against LOPSA. AH is not suing LOPSA, even though court documents list AH as plaintiff and LOPSA as a third-party defendant.
We are hopeful that USENIX will fail in its suit against LOPSA. Unfortunately, it will still be expensive to respond, especially as our general liability insurance company has declined to accept the claim on our behalf.
LOPSA has taken the initial steps to respond, as has been documented in our public minutes. At this stage, the Board is weighing the strategies in defending the suit. Our fundamental cause for concern and worry is that this action may threaten the progress, or even the existence, of LOPSA. We simply cannot afford the legal fees that USENIX can in this matter. We have been advised that the legal fees can be expensive and the litigation process is very slow. This matter inevitably will draw resources away from our mission.
Some of our choices ahead will likely be between unsavory alternatives. We're weighing every decision against what best will fulfill our mission and duty to our members, which remains our first priority. Due to the nature of litigation, we will be unable to discuss many of the details of the litigation. But note that we will endeavor, as always, to be as transparent as possible.
For now, the Board has appointed a committee of our officers — Trey Harris, Philip Kizer, and Stephen Potter — to handle the legal proceedings and day to day concerns. Our goal is to make sure multiple people can work together and cross-check each other, but also not permit this matter to consume the attention of the entire Board to the exclusion of the rest of our programs and mission. We had hoped this episode was entirely behind us, but at the very least we can ensure that our mission is being pursued while we deal with it.
If you have any questions, please don't hesitate to contact the Board. We may not be able to answer every question, but we'll do so to the extent we can. Thank you for your continued support of LOPSA.