Fishing alliance linked to yacht firm
Lawsuits say Viking controls nonprofit
BY ALEXANDER LANE
(Newark) STAR-LEDGER STAFF
February 6, 2005
Whether fighting no-fishing zones, keeping white marlin off the endangered-species list or elbowing commercial fishermen out of favored waters, the Recreational Fishing Alliance makes its voice heard.
The New Jersey-based RFA, which has chapters in all coastal states, bills itself as a “grassroots political action organization representing individual sport fishermen and the sport-fishing industry.” It frequently touts its tens of thousands of members in brochures and press releases.
But according to two recent lawsuits against its executive director, there’s only one member that really matters. The suits say that New Gretna-based Viking Yacht Co., one of the nation’s premier luxury yacht manufacturers, tightly controls the non-profit, tax-exempt RFA, and the two operate as a “single integrated enterprise.”
Fishing advocates and environmentalists said they have long believed as much, maintaining that the RFA cares more about Viking’s interests than those of the fishermen it claims to represent.
“There’s a big difference between what they do and what we do,” said Al Marantz, a founding member of the all-volunteer Jersey Coast Anglers Association, with a membership of about 30,000. “Decisions can be made by (Viking CEO) Bob Healey himself and not really correspond to the wishes of the fishermen.”
Both lawsuits were sexual harassment complaints against RFA Executive Director James Donofrio, and the plaintiffs, both RFA employees, had a clear financial motivation to involve the deep-pocketed yacht company. Raymond Bogan, who represents Donofrio in the lawsuits and the RFA in other matters, said it was “absolutely false” that Viking and RFA operate as a single enterprise.
“There is no question nor has there ever been a question that they are two very distinct entities,” Bogan said. “Viking is a contributor and a sponsor of the RFA, as are a number of other entities.”
Healey founded the RFA in 1996, and Viking remains its prime source of funds, an RFA official said. Until last February, its only three board members were Healry, Donofrio and Viking Chief Financial Officer Gerard Straub Senior., and the RFA operated out of Viking’s office complex in Burlington County. Until June 2001, RFA employees were paid with Viking checks, Straub said.
The RFA paid Viking $2,900 a month in rent for space at the Viking office complex and paid for the payroll services when it received them, Straub said. In February, Donofrio, Healey and Straub elected nine other board members, called “voluntary directors at large,” from other boating companies, publications and organizations.
Experts in nonprofit tax law said the arrangement between RFA and Viking would be illegal if their funds were commingled, or if the RFA did not have independent corporate governance.
“It’s when their governance or their finances get foggy that there is a possibility that the nonprofit status could be revoked,” said Andy Rothman, an assistant dean at Rutgers University School of Law. “That would have to be analyzed.”
James Harrison, a partner at the Atlanta law firm Sutherland Asbill & Brennan who specializes in tax-exempt organizations, said the RFA might be following a well-established tradition among non-profit groups of de-emphasizing their commercial ties and emphasizing their grassroots members “so it will have at least the appearance of being more important to legislators.”
RFA says its 37,000 members include individuals who have paid $35 to join, individual members of fishing clubs that have paid $100 as a club, and corporations that have paid anywhere from $100 to $100,000.
According to its tax filings, the group had revenues of about $1.6 million in 2003, with “direct public support” accounting for about $1.3 million and about $240,000 coming from membership dues. The filing did not say how much came from Viking, but Straub said it was about 41 percent.
Some environmentalists have long accused the RFGA of representing the interests of its boating industry members, and Viking in particular, above those of recreational fishermen.
Benson Chiles, director of the Coastal Ocean Coalition, said the RFA is the driving force behind efforts to pass Freedom to Fish acts – laws sharply limiting the creation of marine protected areas where fishing is banned – on the state and federal levels.
My theory is Viking is concerned about market share,” Chiles said. “If there are places that are protected in the ocean from fishing pressures, then there’s not as much need for a multimillion-dollar yacht to get out to that area.”
Bogan said federal no-fishing zones could hurt Viking’s business, but the RFA’s stance against them is no indication that Viking controls RFA. The zones would also hurt the business of the other manufacturers who belong to RFA, Bogan said. Furthermore, the RFA spends much of its time on issues that affect mom-and-pop charter operators, such as regulations on close-to-shore fish such as striped bass, winter flounder and red snapper, Bogan said.
RFA has put an extraordinary amount of effort into those issues, and those are completely unrelated to any of the big boat companies,” Bogan said.
Viking, founded about 40 years ago, is one of the nation’s largest yacht manufacturers, with more than 1,000 employees. It makes about 110 boats a year, which sell for an average of more than $1.5 million through dealers around the world.
One of the lawsuits against Donofrio, filed in March 2003 by former RFA Legislative Director Sharon McKenna, was settled amicably for terms that remain confidential. The other, filed by another RFA employee named Bonnie Adams, is in the discovery phase. Both were filed in Superior Court in Burlington County.
Alexande Lane covers the environment. He can be reached at
alane@starledger.com or (973) 392-1790.
