September 18, 2011 | Read Time: 4 minutes
When the Heifer Foundation hired Domingo Barrios as its chief executive in July 2010, it praised him for his leadership skills and his passion for helping others, which made him the “ideal fit” to lead the foundation.
One year later, Mr. Barrios is out of a job and is suing four board members of the foundation following a messy dispute that he says began when he raised questions about a possible conflict of interest among trustees.
And while neither side is talking much about a relationship that soured quickly, clues are apparent from court documents. In the lawsuit he filed in June, Mr. Barrios said the board members broke the foundation’s contract with him by suspending him and he is seeking $5-million in damages.
Close Relationship
The 20-year-old Heifer Foundation was created by the board of directors of Heifer International, a global antihunger nonprofit group, to raise money and build an endowment for the charity. The two groups share a close relationship: The chair and vice chair of each organization serve as board members for the other group.
Mr. Barrios said the arrangement raised questions about his board’s ability to make decisions that were in the best interests of the foundation, which has about $71-million in assets.
In the lawsuit, Mr. Barrios says four board members who serve both organizations—Norman Doll, Don Hammond, C. Douglas Smith, and Marcia E. Williams—had conspired to withhold information from their fellow foundation board members about a plan to give the charity authority over unrestricted bequests.
The Chubb Group of Insurance Companies, which insures both organizations, is also a target of the lawsuit.
The lawsuit says that when Mr. Barrios learned of the plan before the Heifer International board’s vote, Mr. Smith and Ms. Williams told him not to discuss it with the foundation board members who were not on the charity’s board until the measure had been approved.
Mr. Barrios informed the other board members about the proposal anyway, the lawsuit says, because he thought giving up the bequest duties went against the foundation’s mission.
His decision to divulge the details of the plan prompted some of the Heifer Foundation’s board to accuse him of violating confidentiality rules, the lawsuit alleges, and to suspend him from his job. The plan was ultimately approved.
In the lawsuit, Mr. Barrios said he believed the move would harm the foundation’s ability to raise money and “would essentially wrestle from and destroy one of the primary purposes of the Heifer Foundation,” which is to obtain bequest commitments.
Joedy Isert, a Heifer International spokesman, said in an e-mail that the charity has a policy designed to guard against potential conflicts of interest. He also said that the four board members Mr. Barrios sued all abstained from voting on the resolution about authority over bequests.
Fired From Foundation
In a statement, the Heifer Foundation said last week that it, too, has “established policies in place to address potential conflicts of interest” but that it would not discuss the lawsuit, which it said it had not yet received. Last month, the organization announced that Mr. Barrios is “no longer with the foundation” and that his position will be temporarily filled by Ardyth Neill, the foundation’s chief financial officer.
A spokesman for the Chubb Group declined to talk to The Chronicle last week as did Mr. Doll, Mr. Hammond, and Mr. Smith.
Other board members did not return phone calls or reply to e-mail messages seeking comment.
Mr. Barrios’s lawyer, Darrell F. Brown Jr., said his client was dismissed for raising questions about the board makeup and is suing over his suspension.
“He was fired,” Mr. Brown said. “We’ll be amending our lawsuit to include wrongful termination.”
Circumstances Uncertain
Nonprofit-law experts say it’s hard to tell from the outside whether a conflict of interest between the foundation and the charity is a valid concern.
“Whether there was a conflict of interest depends on all the facts and circumstances, including the type of transaction between the organizations, the impact of one board’s decision on the other organization, and the personal interests of the common directors,” said Gene Takagi, a lawyer who specializes in advising nonprofits.
In the meantime, Mr. Barrios is seeking a new job at a foundation or charity and is hoping for a resolution to the lawsuit, his lawyer said.
“He was terminated for doing what he thought was the best interest of the foundation,” Mr. Brown said.
