Two Inperium execs sue Impact Services over their ouster from the Kensington nonprofit’s board
The executives were voted off the board on the same day Impact decided to cancel its takeover by Inperium Inc.
Two executives from Reading-based Inperium Inc. have sued Impact Services Corp., a Kensington community development nonprofit, over their ouster from Impact’s board of directors.
The executives, George Contos and John Loyack, filed their lawsuit in the Philadelphia Court of Common Pleas on Jan. 7, alleging that their termination from Impact’s board on Dec. 30 violated Impact’s bylaws. The bylaws say the board can remove a director “for cause,” but did not give examples of appropriate reasons.
The executives asked for a court injunction putting back on the Impact board.
Contos and Loyack had joined the Impact board in August, when Impact accepted a $1 million line of credit from Inperium and reached a preliminary agreement to be acquired by the fast-growing human services nonprofit, which completed its acquisition of Philadelphia’s nonprofit Resources for Human Development last month.
At the Dec. 30 special board meeting, the Impact board also voted to end the planned takeover by Inperium, according to the lawsuit. The case was transferred to Orphans’ Court on Jan. 9. Orphans’ Court handles certain legal matters involving nonprofits.
That board meeting happened on the same day Contos asked to see Impact’s “books and records.”
Contos wanted to assess Impact’s financial condition, investigate potential mismanagement, and examine Impact’s compliance with legal and contractual obligations, including “binding agreements” Impact had with Inperium, according to a copy of Contos’s demand filed with the complaint.
The demand by Contos came after Impact won a $5 million Bezos Day 1 Families Fund grant at the end of last year, the lawsuit said. The money is for programs to help families experiencing homelessness.
The Orphans’ Court docket showed no response to the complaint by Impact.
“The Impact board of directors took action that was compliant with the bylaws and was in the best interest of Impact Services,” the organization’s CEO Casey O’Donnell said in an email.