The Events with NHF

While there is a series of unfortunate events that occurred to NHF several years ago, the “news” stories and blogs found on the web are blatantly misleading to completely false. Dr. J.T. Dock Houk

would like to set forth some of the history of this charity.

In 2006, NHF was sued by a family in Texas over an insurance policy the family donated to NHF. The Mancillas family lived in Texas and retained a lawyer known for attacking companies with “deep pockets”, meaning companies with large asset base and insurance. NHF had to appear in the Brownsville Texas courts to fight this case. NHF tried to get its insurance company, Philadelphia Indemnity Insurance Company, to indemnify NHF in this case which was clearly a covered claim. The insurance company declined. NHF made every effort to resolve the case amicably, including making efforts to settle with the Mancillas family, but they turned down all efforts. In the summer of 2008, the court in Texas, presided by Judge Abel Limas, tried our case. (Note that the Judge was voted into office, that the Mancillas family were personal friends with the judge, and that critical evidence in our case was suppressed.) NHF lost and a very heavy judgment was levied.

With the Mancillas case, NHF needed to post a bond to appeal the Texas judgment in the amount of the judgment which was $7 million dollars. Bond insurers would not allow NHF to secure a bond with stocks because of the volatility in the markets at that time – stocks were fluctuating by thousands of points daily. The insurers required cash. NHF had to liquidate millions of its stock accounts very quickly to post the bond. This resulted in having to file for bankruptcy.

NHF reorganized in the fall of 2009, paid off the annuitants and other creditors, unfortunately with donated funds, because it was required to by the bankruptcy courts to do so. Since the fall of 2009, NHF has restored nearly $2M in lost funds to donor’s accounts from its own assets held in more illiquid form. There was no court mandate to do this, NHF has voluntarily done so.

In 2011, NHF sued its insurance company for failure to cover and for bad faith in denying coverage in the Mancillas case. NHF won a settlement from Philadelphia and has used those funds to restore even further its donor advised funds, to pay tremendous legal bills in the bankruptcy and ensuing insurance.