Why I’m Suing the Penn State Board of Trustees
Pennsylvania statute 5512(a) is clear: trustees have a right to information.
On Tuesday I filed suit in Centre County, Pennsylvania Court of Common Pleas for declaratory and injunctive relief against the Penn State Board of Trustees, and Matthew Schuyler in his capacity as Board Chair.
I did not take this action lightly.
My complaint is straightforward: by Pennsylvania legal statute Title 15 Section 5512(a), a trustee of a nonprofit corporation has the right to ‘access and copy the University’s books, records, and documents so long as doing so is reasonably related to the performance of the duties of a trustee.’ If the leadership refuses to provide that access, they are breaking the law. If some members of the corporation are provided that information and others are denied, that is also breaking the law. Part (b) of the statute says that a trustee may sue to ‘compel the inspection or the obtaining or providing of the information’.
You can read my complaint here. It’s not long, and I think you’ll find it interesting.
Since I was elected to the Board in 2022, I have made my concerns about the management of the Penn State endowment clear (see here, here, and here). The endowment is the University’s largest asset, currently valued at approximately $5 billion, and is managed by the Office of Investment Management. They are directly overseen by the Board, which maintains final responsibility for the endowment. The Board also appoints the members of an oversight group known as the Penn State Investment Council (PSIC). Trustees Brandon Short and Emeritus Trustee Barb Dolan are members of this council.
According to the PSIC policy statement ,“PSIC meetings are not subject to Open Meeting Laws and are only open to PSIC members and invited guests.” They don’t have to take minutes, or allow other trustees access to their information. Once a year they report to the full board but that presentation is a broad-brush overview with little detail provided.
Despite the secrecy, I have tracked publicly available information in the University’s IRS 990 endowment filings. Among the items of interest to me was the significant jump in administrative fees paid to investment fund managers beginning in 2016, a clear departure from the reasonable 75 basis points paid yearly between 2008-2015.
When I joined the Board in 2022 and requested relevant information regarding the endowment, I was told by Finance, Business, and Capital Planning Committee Vice-Chair Trustee Robert Fenza, “You don’t need it. You need to mind your own business and trust others.”
The next 20 months were a runaround of bouncing between being provided useless data instead of the information I requested, and being told I was asking the wrong person. I was then reprimanded by Board leadership for requesting the information necessary to fulfill my fiduciary duties. My request culminated on February 16, 2024 when Finance, Business, and Capital Planning Committee Vice-Chair Trustee Mary Lee Schneider told me, “You will never be given that information. That is my decision, and I will make sure you never get it.”
Well. I had no choice but to take legal action, so here we are.
To be clear, I am making no allegations of malfeasance or gross negligence. But activities like those would be impossible to uncover without access to the information requested. And for the record, I hold several financial industry licenses and certifications so I do know what I’m looking for.
I am filing this motion pro se, or representing myself. I am fully aware of Abraham Lincoln’s advice, “The man who represents himself has a fool for a client.” But I have four kids, two of whom just graduated from college and two who are working their way through, and after discussing it with my wife it is clear that taking on large legal expenses was not an option. I am in debt to smart friends who love Penn State and have given their time and good counsel. That is the best kind of debt one can take on, and I am very grateful. I hope that I prevail.
I am happy to answer any questions you may have, and appreciate your support.
Go get 'em! As we lawyers like to say, the conduct of the Board's hierarchy and the PSU Administration does not pass the smell test! They must be hiding something important. Their inability, incompetence, or both, to restrain spending and provide students with a college degree at a reasonable cost has been inexcusable for at least the past four decades, and all while the University Administration and professor incomes have skyrocketed at totly unacceptable rates.
We got your back!