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The Committee to Save Adelphi v. Diamandopoulos
Board of Regents of the University of the State of New York
Petition by the Committee to Save Adelphi (1997)
Due to instability in the insurance market, the Adelphi University (Adelphi) board of trustees (defendant) appointed a committee led by Ernesta Procope (defendant) to reassess Adelphi’s insurance provider and evaluate its options. Procope hired insurance-brokerage firm E.G. Bowman, Inc. (Bowman) to conduct the analysis. Bowman was wholly owned by Procope. Adelphi received an insurance proposal from brokerage firm Treiber-Salerno, but Bowman found it to be lacking certain information. Bowman did not follow up with Treiber-Salerno to ask for that information. Rather, Peter Diamandopoulos (defendant), the president of Adelphi, ultimately reported to the board of trustees that Bowman would be providing Adelphi’s insurance for free. In actuality, Bowman provided free insurance to Adelphi for one year but was paid in full by Adelphi after that. Diamandopoulos never reported to the board of trustees that the free arrangement had changed. In similar fashion, trustee George Lois (defendant) owned an advertising agency. Lois proposed to the board of trustees that his agency take over Adelphi’s advertising. The board of trustees approved the proposal and removed Adelphi’s existing advertising agency. In front of the board of trustees, Diamandopoulos thanked Lois for providing his advertising services for free. In actuality, Lois was paid $155,000 in commissions from Adelphi’s advertisements and was also paid costs for making certain Adelphi brochures. Neither Diamandopoulos nor Lois corrected the board of trustees’ mistaken belief. The Committee to Save Adelphi (the committee) (plaintiff) filed a petition with the New York Board of Regents, asking it to remove Diamandopoulos and other trustees from Adelphi’s board of trustees.
Rule of Law
Holding and Reasoning
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