October 30, 2008 | Read Time: 1 minute
A Texas court has ordered the National Heritage Foundation, a Virginia charity, to pay millions of dollars in damages to two donors who claimed to have been misled by the organization.
The National Heritage Foundation, which was one of the leading promoters of a controversial giving technique that was effectively abolished by a 1999 law, must pay Juan J. and Silvia Mancillas, of Texas, and the couple’s two sons, a total of $6.5-million.
The Mancillas, who had given nearly $550,000 to the organization through the questionable giving scheme, alleged in a 2005 lawsuit that the charity failed to carry out the couple’s financial plans or charitable intent.
A 12-person jury issued a verdict last month, following a nine-day trial, siding with the plaintiffs and recommending that the charity pay the couple $9-million in damages.
Judge Abel C. Limas last week set the damages at $6.5-million, based in part on the cash value of life-insurance policies that were bought with the Mancillases’ contributions.
In an e-mail message, John T. Houk, president of the National Heritage Foundation, said that the organization “respectfully disagrees with the verdict and plans to appeal its findings.”
